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Thread: DOJ Investigates 'Mystery' Goldman Executive Involved In $4.5 Billion 1MDB Fraud

  1. #31
    When it rains inside the halls of Deutsche Bank, the flood is biblical.
    Just when it seemed that the biggest (if not for long) German bank, already reeling from the biggest mass layoffs since Lehman, couldn't possibly bear any more bad news, along comes the US government with yet another potentially criminal investigation, this time over Deutsche Bank's involvement with the sprawling, multibillion-dollar Malaysian development fraud scandal that toppled a prime minister, crippled Goldman Sachs stock and stretched from Hollywood to Wall Street.
    According to the WSJ, the DOJ is investigating whether the German bank violated foreign corruption or anti-money-laundering laws in its work for the 1Malaysia Development Bhd. fund, or 1MDB, which included helping the fund raise $1.2 billion in 2014 as concerns about the fund’s management and financials had begun to circulate.
    So how did Deutsche Bank get thrown into yet another scandal? It turns out that DB was snitched out by former Goldman banker, Tim Leissner, the man who was ground zero in the original 1MDB scandal, and who ended up costing Goldman billions in dollar in market cap as its stock tumbled last year as its role in the biggest Malaysian corruption scandal got exposed, and according to some, cost Lloyd Blankfein his job. As it turns out, Leissner is now cooperating with authorities, and among his "good Samaritan" duties decided to throw the one bank that has more dirt on it than Goldman: Deutsche Bank. As we have reported extensively in the past, prosecutors have been investigating similar issues at Goldman, where Leissner, a former managing director, pleaded guilty last year and admitted to earlier helping siphon off billions of dollars from the fund.


    But what does Goldman, and Leissner, get in exchange? Apparently a settelment. From the WSJ:
    Meanwhile, the Justice Department is set to begin negotiations with Goldman soon to try to resolve allegations through a possible criminal settlement, a senior official said. “We do anticipate getting into active discussions with Goldman, at this point, in the near future,” Assistant Attorney General Brian Benczkowski, who runs the agency’s criminal division, said in an interview. He declined to comment on any other aspect of the 1MDB investigation.
    As the Journal further notes, prosecutors are focused, in particular, on the role of one of Leissner’s former colleagues, Tan Boon-Kee, who worked with Mr. Leissner on 1MDB-related business. She then left Goldman to become Asia Pacific head of banking for financial-institutions clients at Deutsche Bank, "where she was involved with further 1MDB dealings."
    Ms. Tan left Deutsche Bank last year, after the bank discovered communications between her and Jho Low, the Malaysian financier described by the Justice Department as the central player in the 1MDB scandal, according to a person familiar with her exit. Neither she nor the bank have commented publicly about the reason for her departure.
    “Deutsche Bank has cooperated fully with all regulatory and law-enforcement agencies that have made inquiries relating to 1MDB,” a spokesman for the bank said. He cited Justice Department documents saying 1MDB made “material misrepresentations and omissions to Deutsche Bank officials” in connection with 1MDB’s transactions with the bank. “This is consistent with the bank’s own findings in this matter,” he added.
    What is notable is that whereas Goldman Sachs received the most for its involvement in the 1MDB scandal and for helping the Malaysian fund raise $6.5 billion of bonds and the role of Leissner as a key co-conspirator in the scheme to steal money, the German bank had so far managed to avoid the spotlight.
    But, as we now learn, Deutsche Bank, too, played a large role in a variety of transactions related to 1MDB. In fact, DB's role may even be greater than that of Goldman: in the most recent version of the Justice Department’s civil asset-forfeiture complaint, in which it details the 1MDB scheme at length, Deutsche Bank is mentioned 167 times. Goldman Sachs is mentioned 56 times.
    The complaint says Deutsche Bank was involved with 1MDB from its earliest days in 2009 as the bank facilitating financial transfers related to 1MDB’s first big deal, a joint venture with a little-known Swiss company called PetroSaudi. The Justice Department alleges that a group of conspirators led by Mr. Low, the Malaysian financier, stole some $1 billion from the $1.8 billion contribution by 1MDB, but it doesn’t describe any failing of Deutsche Bank in the complaint. PetroSaudi has denied any wrongdoing.
    Deutsche Bank also arranged emergency loans for 1MDB in 2014 totaling $1.2 billion. The Justice Department said that money was also mostly stolen by Mr. Low and his co-conspirators. The bank called in the loan early, however, when it realized 1MDB’s collateral was impossible to verify, and 1MDB got an Abu Dhabi sovereign-wealth fund it often worked with to extend a $1 billion loan to replace Deutsche Bank, according to the complaint and Malaysian investigative documents.
    The bottom line is that whereas Deutsche Bank probably did not engage in outright criminal fraud, its anti-money laundering process and "Know Your Client" protocols will be closely scrutinized, even if the banker(s) who were in charge of these activities are likely long gone.

    More at: https://www.zerohedge.com/news/2019-...s-it-under-bus
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  3. #32
    After filing charges against the bankers who allegedly masterminded the bond deals that seeded Malaysian sovereign wealth fund 1MDB with billion of dollars for 'development' purposes, and then the three Goldman subsidiaries - Goldman Sachs International, Goldman Sachs (Asia) LLC and Goldman Sachs (Singapore) Pte. - operating in the region where the scam was perpetrated, Malaysia's muckraking attorney general Tommy Thomas is now going after 17 current and former Goldman directors.

    The criminal charges are the latest step in Thomas's crusade to recover the billions of dollars - with a face value of $6.5 billion - that were allegedly stolen from 1MDB by former Prime Minister Najib Razak and his inner circle.
    The Goldman directors were being charged under Malaysia's Capital Markets and Services Act, which has provisions that hold senior executives responsible for violations committed by their organizations.


    More at: https://www.zerohedge.com/news/2019-...s-1mdb-scandal
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
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  5. #33
    Malaysia is open to more talks with Goldman Sachs after having two rounds of discussions to drop criminal charges against three units of the bank over the 1MDB scandal, the country's top prosecutor told the Nikkei Asian Review.Malaysian and U.S. investigators say about $4.5 billion was misappropriated from the now-defunct state investment fund 1Malaysia Development Berhad, set up in 2009 by former prime minister Najib Razak.
    Last year, Malaysia filed criminal charges against Goldman over its role as underwriter and arranger of three bond sales that raised $6.5 billion for 1MDB. Prosecutors in August filed criminal charges against 17 current and former directors at its units.
    Malaysia had a strong case and was very confident of winning, Nikkei on Thursday cited Malaysian Attorney General Tommy Thomas as saying, but that criminal charges and settlement negotiations were taking place in parallel.
    "A lot of cases are even settled even after the trial begins," he said. "So the doors for discussion are still open while the prosecution readies the criminal case."
    Thomas and officials in his office were not immediately available for comment.
    No date has been set for the criminal trial yet.
    Malaysia's finance minister said in January the government would be ready to discuss dropping criminal charges against Goldman if it agreed to pay $7.5 billion in reparations.

    More at: https://finance.yahoo.com/news/1-mal...082603022.html
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  6. #34
    ^^^^^^
    Goldman execs to Malaysian government: "This Singapore here, it's a nice little city you got here. It would be a shame if something happened to it like in Hong Kong. Damn shame. So you were saying what about those criminal charges against us?"
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  7. #35
    The Department of Justice has reached a settlement of its civil forfeiture cases against assets acquired by Low Taek Jho, aka Jho Low, and his family using funds allegedly misappropriated from 1Malaysia Development Berhad (1MDB), Malaysia’s investment development fund, and laundered through financial institutions in several jurisdictions, including the United States, Switzerland, Singapore and Luxembourg.
    These assets, located in the United States, the United Kingdom and Switzerland, are estimated to be worth more than $700 million. With the conclusion of this settlement, together with the prior disposition of other related forfeiture cases, the United States will have recovered or assisted in the recovery of more than $1 billion in assets associated with the 1MDB international money laundering and bribery scheme. This represents the largest recovery to date under the Department’s Kleptocracy Asset Recovery Initiative and the largest civil forfeiture ever concluded by the Justice Department.

    More at: https://www.justice.gov/opa/pr/unite...edly-traceable
    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

  8. #36
    Quote Originally Posted by devil21 View Post
    ^^^^^^
    Goldman execs to Malaysian government: "This Singapore here, it's a nice little city you got here. It would be a shame if something happened to it like in Hong Kong. Damn shame. So you were saying what about those criminal charges against us?"
    Malaysia Rejects Goldman's Offer Of "Less Than $2 Billion" To Settle 1MDB Suit

    Never attempt to teach a pig to sing; it wastes your time and annoys the pig.

    Robert Heinlein

    Give a man an inch and right away he thinks he's a ruler

    Groucho Marx

    I love mankind…it’s people I can’t stand.

    Linus, from the Peanuts comic

    You cannot have liberty without morality and morality without faith

    Alexis de Torqueville

    Those who fail to learn from the past are condemned to repeat it.
    Those who learn from the past are condemned to watch everybody else repeat it

    A Zero Hedge comment

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