The underlying facts behind the world’s biggest financial scam are even more startling than when we first reported it. Now the US government has dramatically stepped in.

19 December 2019 By Paul Martin

When we first wrote this story on 17th January 2019 we added: The underlying facts behind this are even more startling. Watch this space.

Now we can reveal it was indeed “even more startling”, after an American government report laid bare a huge fraud.

US Securities Commission has issued a ‘Cease & Desist Order’ dated Monday 16 December 2019 against the former Goldman Sachs Bank’s South East Asia chief Tim Leissner. It has banned him from holding any position relating to finance in the United States.

But the order contradicts the claim by the Bank’s US-based CEO that, unbeknown to the rest of the bank’s top executives, Leissner was acting as a sort of rogue trader.

It now seems the Bank will have to pay the US government 2 billion dollars to sneak out of the scandal without anyone being jailed. The Malaysian government is also demanding a refund – of 7.5 billion dollars.

We include some extracts from the explosive US order.

“This matter relates to a massive corruption scheme perpetrated by Leissner while acting as a senior executive of The Goldman Sachs Group, Inc. (“Goldman Sachs” or the “Company”). Leissner, in coordination with other Goldman Sachs senior executives, authorized and paid bribes and kickbacks to government officials in Malaysia and the Emirate of Abu Dhabi (“Abu Dhabi”) in order to secure lucrative business for Goldman Sachs. Leissner’s actions resulted in violations of the antibribery, books and records and circumvention of internal accounting controls provisions of the Foreign Corrupt Practices Act (“FCP A”)…..

… Throughout 2012 and 2013, Leissner and other senior executives of Goldman Sachs actively worked to obtain and retain business from 1MDB for the benefit of Goldman Sachs through the promise and payment of bribes and kickbacks to government officials in Malaysia and Abu Dhabi using, in part, misappropriated and embezzled proceeds from the bond deals. During this time, through the course of the scheme, Leissner and others paid millions of dollars in bribes and kickbacks to government officials, and obtained 1MDB business for Goldman Sachs, in particular, the three bond deals. These three bond financing transactions were referred to internally at Goldman Sachs as “Project Magnolia,” “Project Maximus” and “Project Catalyze.”

The 13-page order specifically names the former Malaysian prime minister Najib Razak several times as it details Leissner’s offences under a series of banking regulations. It states as a fact that bribes were taken by the now deposed Prime Minister in return for sanctioning the lucrative bond business with Goldman Sachs. Najib is now on trial in Malaysia.

“Leissner and others instead planned and executed a scheme to misappropriate more than $2.7 billion and distribute the money as bribes and kickbacks to government officials in Malaysia and Abu Dhabi, including but not limited to Najib Razak, as well as to other participants in the scheme and their families, including Leissner….

… Leissner also knew at the time that Najib Razak and government officials from Abu Dhabi and 1MDB officials would receive money from the proceeds of Project Maximus that passed through various shell companies beneficially owned and controlled by himself, Low and others….  A close relative of Najib Razak and a senior official with the Middle Eastern Sovereign Wealth Fund, among others, received some of these funds.”

The order refers to other unnamed senior colleagues at Goldman Sachs, who were also allegedly involved and complicit in the criminal conspiracies to rob a total of $2.5 billion from three bonds.

“These bribes and kickbacks included transferring millions of dollars to the accounts of shell companies beneficially owned and controlled by 1MDB officials, and transferring approximately $1.3 million to the account of a New York jeweler to pay for jewelry for the spouse of Najib Razak…

“…. Between in or around June 2012 and October 2014, more than $200 million of the proceeds of the three 1MDB bond deals and other 1MDB business was transferred by Low or at his direction into accounts beneficially owned and controlled by Leissner.”

The future of the bank itself is at stake. However, there are reports that a deal has already been brokered that lets the bank off lightly by simply imposing fines.

This is what we wrote:

A brave British blogger [Clare Rewcastle Brown who runs the Sarawak Report] should be getting the credit for exposing the scandal that led to the woes of the Goldman Sachs bank.  Her blog alleges serious criminality and likely prosecutions, if not the collapse, of this once gold-plated internationally-renowned bank.  Watch this space for the REAL story.

NEW YORK – Goldman Sachs chief executive David Solomon has apologised to the Malaysian people for the role of its chief Asia “partner” in a huge embezzlement scandal, involving a rip-off of at least 4.5 billion dollars of money from a State-financed fund set up in part ostensibly to protect the country’s fast-vanishing world-renowned oxygen-producing forests.

“Extraordinarily, he [Solomon] defended his bank then apologised to the people of Malaysia,” noted Lex who writes a column in the Financial Times, the most respected financial newspaper and website in the world. 

Solomon said that the blame was to be shouldered only by a former senior partner Tim Leissner, who has pleaded guilty in the USA to participating in the fraud.  It turns out Leissner was its senior representative for the whole of Asia.

“For Leissner’s role in that fraud, we apologise to the Malaysian people,” Solomon said during his first earnings call with analysts.

Goldman Sachs is being sued for billions and criminally prosecuted in Malaysia for its role in helping a Malaysian sovereign fund 1MDB to raise 6.5 billion dollars in debt. The effective controller of this fund, prime minister and finance minister Najib Razak, was toppled from power last year in a shock election defeat that has now opened up devastating lines of official inquiry. The Financial Times says much of that 6.5 billion dollars was allegedly “stolen or paid in bribes”.

“People here are extremely angry and upset about the fact that we have had a partner of the firm involved in such a significant fraud,” Solomon is quoted as telling analysts.

It seems to be the US Justice Department’s investigation that has spooked Solomon into his divert-the-blame ‘apology’.

Leissner is now apparently cooperating with the US authorities and is willing to spill some extremely damaging beans.  So much so that the bank, despite its claim of corporate innocence, has set aside a whopping 516 million dollar provision for litigation and regulatory matters.

Lex in the Financial Times says it is “telling” that Goldman Sachs has raised its legal reserves by 500 million dollars “in anticipation of fines or judgments”.

The New York Times had a much more detailed story about the shenanigans of Goldman Sachs and its potential liability.

When we first wrote this story on 17th January 2019 we added: The underlying facts behind this are even more startling. Watch this space.

Now we can reveal far more, after an American government report laid bare a huge fraud.

In Latest News

Edit

A brave British blogger should be getting the credit for exposing the scandal that led to the woes of the Goldman Sachs bank.  Her blog alleges serious criminality and likely prosecutions, if not the collapse, of this once gold-plated internationally-renowned bank.  Watch this space for the REAL story.

NEW YORK – Goldman Sachs chief executive David Solomon has apologised to the Malaysian people for the role of its chief Asia “partner” in a huge embezzlement scandal, involving a rip-off of at least 4.5 billion dollars of money from a State-financed fund set up in part ostensibly to protect the country’s fast-vanishing world-renowned oxygen-producing forests.

“Extraordinarily, he [Solomon] defended his bank then apologised to the people of Malaysia,” noted Lex who writes a column in the Financial Times, the most respected financial newspaper and website in the world. 

Solomon said that the blame was to be shouldered only by a former senior partner Tim Leissner, who has pleaded guilty in the USA to participating in the fraud.  It turns out Leissner was its senior representative for the whole of Asia.

“For Leissner’s role in that fraud, we apologise to the Malaysian people,” Solomon said during his first earnings call with analysts.

Goldman Sachs is being sued for billions and criminally prosecuted in Malaysia for its role in helping a Malaysian sovereign fund 1MDB to raise 6.5 billion dollars in debt. The effective controller of this fund, prime minister and finance minister Najib Razak, was toppled from power last year in a shock election defeat that has now opened up devastating lines of official inquiry. The Financial Times says much of that 6.5 billion dollars was allegedly “stolen or paid in bribes”.

“People here are extremely angry and upset about the fact that we have had a partner of the firm involved in such a significant fraud,” Solomon is quoted as telling analysts.

It seems to be the US Justice Department’s investigation that has spooked Solomon into his divert-the-blame ‘apology’.

Leissner is now apparently cooperating with the US authorities and is willing to spill some extremely damaging beans.  So much so that the bank, despite its claim of corporate innocence, has set aside a whopping 516 million dollar provision for litigation and regulatory matters.

Lex in the Financial Times says it is “telling” that Goldman Sachs has raised its legal reserves by 500 million dollars “in anticipation of fines or judgments”.

The New York Times had a much more detailed story about the shenanigans of Goldman Sachs and its potential liability.

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