A former Goldman Sachs bigwig in Asia is being pressed by U.S. prosecutors. The want to know if the Wall Street bank ignored alleged malpractice when it issued $6 billion in 1MDB bonds.
U.S. prosecutors would like ex-Goldman Sachs banker Tim Leissneras a key witness in their investigation of an alleged $4.5 billion 1MDB corruption scheme, according to a «Bloomberg» report. Leissner is reportedly talking to investigators over a plea agreement for the U.S. bank's former head in southeast Asia.
German native Leissner’s acquiescence to the long-running probe is significant: he associated closely with alleged 1MDB kingpin Jho Low, a relationship which ultimately cost Leissner his Goldman Sachs job. Leissner likely has substantial information about Low, who has reportedly been detained in China, but might also help U.S. prosecutors understand Goldman's role in lucrative bond deals for 1MDB.
Questionable Bond Deals
He helped Goldman win almost $6.5 billion in bond deals from 1MDB, earning the bank $600 million in fees. Malaysia is mulling making a play for the fees to be recouped from the American bank.
Goldman has said that it found actions which appeared to have been deliberately hidden since suspending Leissner, and that it reported the activities to authorities. The U.S. giant appears to be the bank deepest into 1MDB's capital markets business, while private banks such as Banca della Svizzera Italiana (BSI), Falcon Private Bank, and UBS dealt with the wealth management side.
Alex Turnbull, the son of Australian Prime Minister Malcolm Turnbull, claims he got an eyeful of the contentious bond deals while working at Goldman Sachs. The banker, who worked for Goldman in Singapore until five years ago, said he was shunned by Goldman Sachs after raising the alarm about the firm's issuing of 1 MDB bonds and his career «B-tracked», or stalled, after speaking up.
