NEW YORK: Former Goldman Sachs Group Inc banker Tim Leissner did not only rip off hundreds of millions of dollars from Malaysian wealth fund 1MDB, he also stole tens of millions of dollars from his accomplices in the fraud.
He forged divorce papers and even tried to con his ex-wife into transferring US$900,000 for a house he wanted to buy for his then new wife, American model Kimora Lee Simmons.
Leissner said he kept for himself US$80mil from €145mil he had been asked to “hold”.
He also borrowed another US$1.25mil from Roger Ng, his subordinate at Goldman, which he never repaid, he admitted during Ng’s corruption trial in New York.
Leissner said he and Ng also used their wives to conceal the kickbacks they received.
Leissner, who had been Ng’s supervisor at Goldman before becoming the star government witness against him, said he received kickback payments from fugitive Malaysian financier Low Taek Jho for helping embezzle funds Goldman raised for 1MDB through three bond sales.
Low, better known as Jho Low, was the intermediary in the deal.
Leissner, 52, said that after the first bond sale in 2012, he received US$35mil from Low, and transferred half of it to Ng.
Both then discussed a “cover story” to explain the payments.
“His wife’s family had previously made an investment in my wife Judy’s business in China, and this was ‘return of that investment’,” Leissner told the jury in Brooklyn federal court, referring to his former wife Judy Chan.
He said the story was untrue, and that he did not know if Ng, 49, relayed it to his bank.
The statement could be problematic for Ng, who is on trial after pleading not guilty to conspiring to commit money laundering and violating an anti-corruption law.
The charges stem from one of the biggest financial scandals in history, in which US prosecutors say US$4.5bil of the US$6.5bil Goldman raised for 1MDB was diverted to government officials, bankers and associates through bribes and kickbacks.
Leissner also testified that in 2013, while separated from Chan, he forged divorce papers in order to marry Kimora Lee, the former wife of US music producer Russell Simmons.
“I photoshopped the divorce document,” he said.
“Did Judy Chan know?” asked prosecutor Drew Rolle.
“Yes,” he said.
“Did Kimora Lee Simmons know that?” Rolle asked.
“No,” Leissner said.
He said that in 2014, he wanted to put a US$900,000 down payment on a home in Los Angeles for Simmons but said: “Judy did not want to make any transfers related to my new family life in Los Angeles.”
Instead, Leissner said he faked an email claiming Low needed money.
“It didn’t work,” he said.
On ripping off his accomplices, Leissner said when Jho Low, the alleged architect of the massive fraud, asked him to “hold” €145mil in a shell company in Mauritius, he kept US$80mil for himself.
He said he then borrowed US$1.25mil from Ng.
Leissner said his arrest in 2018 prevented him from repaying Ng any of the money.
“I had the intention to pay him back over time but I didn’t have a chance,” he told the jury.
In another development, Leissner told how Low had to step in when the first 1MDB bond deal in May 2012 ran into a hitch at the last moment – they were missing a crucial signature.
Khadem al-Qubaisi, who was head of International Petroleum Investment Co (IPIC) – and had been paid off to guarantee the US$1.75bil transaction – could not be found.
“Without the signature there would be no Project Magnolia,” Leissner said, referring to the deal’s name.
He and Ng and the others reached out to Low as “he was the key gatekeeper between us and Khadem”.
The head of Abu Dhabi’s state-owned energy company “was found in the south of France”.
Al-Qubaisi was sentenced in Abu Dhabi in 2019 to 15 years in prison and ordered, with another IPIC executive, to repay US$336mil, according to the Wall Street Journal. — Agencies