FT: Once its star banker, Tim Leissner now the biggest threat to Goldman Sach’s reputation

Tim Leissner with his wife former supermodel Kimora Lee Simmons. — AFP file pic
Tim Leissner with his wife former supermodel Kimora Lee Simmons. — AFP file pic

KUALA LUMPUR, Dec 24 — Before the 1MDB scandal blew up his life, Tim Leissner was known as the good-looking star banker at Goldman Sachs married to former American model and now-TV celebrity Kimora Lee Simmons.

Today, Leissner is shunned by his former colleagues as was evident by his absence at a recent party to celebrate his former firm’s 150th anniversary.

The former rising star at Goldman Sachs earned his company “tens of miilions of dollars at this peak,” a Financial Times (FT) report said.

The same report added that Leissner may now be “the biggest ever threat” to Goldman’s reputation.

“Once praised by executives as an example to emulate, Mr Leissner has become a pariah inside the bank, after pleading guilty to bribery, conspiracy and money laundering charges in connection with a vast fraud at Malaysia’s state development fund,” FT reported.

While the Goldman Sachs has attempted to distance itself from the controversy, Leissner's own admission that concealing information from the bank's compliance officers was “very much in line” with Goldman Sachs' business culture was a serious body blow.

The report stated that recent revelations that the bank's now former chief executive Lloyd Blankfein met with fugitive businessman Low Taek Jho or Jho Low — who is at the heart of the scandal — in 2009 and 2012, raised further suspicion.

While the storied investment bank is no newbie to controversies, it may find the latest financial scandal a little harder to shake off.

Putrajaya had last week put an amount — US$7.5 billion (RM31.25 billion) — to the compensation it is seeking from Goldman Sachs for its blunder over 1MDB.

Finance Minister Lim Guan Eng told FT that the government is looking for reparation beyond the sum of its losses in the “excessive” US$600 million fees paid to Goldman Sachs and three bonds arranged by the bank.

“The bond offerings were always controversial, due to the high amount Goldman earned from the fundraising and the fact that it acted as a sole bookrunner on such a large deal.

“The long-term damage to Goldman’s franchise is hard to quantify. Executives say that so far it has been limited to Singapore and Malaysia. But the head of a rival investment bank argues that Goldman ‘won’t be as aggressive and as cute as it used to be ... it will lose its edge’,” FT reported.