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KUALA LUMPUR, July 10 — Banker Tim Leissner is in plea talks with United States prosecutors in its criminal fraud investigation into scandal-plagued 1Malaysia Development Bhd (1MDB), financial daily Wall Street Journal (WSJ) reported today.
The former partner and South-east Asia chairman of Goldman Sachs Group Inc was reported to be planning to plead guilty over a violation the US Foreign Corrupt Practices Act — which bans bribing foreign officials for business — sources told WSJ.
But legal experts told the daily that any information provided by Leissner would first need to be corroborated, and vetted for usefulness, before any plea could be agreed on.
“Since we suspended Leissner, we have discovered that certain activities he undertook were deliberately hidden from the firm, which we have brought to the attention of the relevant authorities,” a Goldman spokesman told WSJ.
A lawyer for Leissner refused to comment on the bank’s statement.
US investigators previously were reported saying 1MDB was used by ousted prime minister Datuk Seri Najib Razak as a political slush fund, and by his associates to purchase real estate, arts, and other luxuries, alleged by the US Department of Justice to be worth US$4.5 billion (RM18 billion).
Leissner was Goldman’s top banker working on 1MDB, and had forged a close relationship with Penang-born financier Low Taek Jho who is now wanted by both Malaysia and Singapore authorities for suspected involvement in the misappropriation of billions from the fund.
According to WSJ, the US Attorney’s Office is also investigating if the bank violated any laws, after earning nearly US$600 million from its role in arranging several sales of 1MDB bonds.
The daily also reported US investigators as saying the billions of dollars raised through the bond offerings were routed back to bank accounts linked to Najib and the fugitive financier popularly called Jho Low.
The report said Leissner met Low in 2009, and in the same year, Goldman became an adviser to the Terengganu Investment Authority, which later became 1MDB.
The bank had advised 1MDB on two bond sales in 2012, raising US$3.5 billion, and a third one the next year which raised another US$3 billion.
It said Leissner was suspended from the bank in early 2016 and later quit the firm, after an authorised letter written by him to a Luxembourg bank vouching for Low was discovered by Goldman.