Former Goldman Sachs employee sentenced to two years in prison for devising scheme to swindle billions from Malaysia's 1MDB investment fund.
A former Goldman Sachs banker, Tim Leissner, was sentenced to two years in federal prison on Thursday for his part in a $4.5 billion scheme to pilfer funds from a Malaysian state investment fund, 1Malaysia Development Berhad (1MDB).
On this occasion, Leissner, who apologized for the "greed" that led to the misappropriation of funds intended to improve Malaysia, appeared before a judge in Brooklyn federal court. "The funds raised more than a decade ago could have significantly benefited the nation and its citizens," he stated.
Prosecutors argued that Leissner and other Goldman Sachs bankers assisted 1MDB in raising $6.5 billion through bond sales. However, they assert that over $4.5 billion of those funds were misappropriated through bribes and kickbacks. The proceeds were used to finance frivolous expenditures, such as excessive parties, luxury real estate, art, jewelry, a superyacht, and the 2013 film "The Wolf of Wall Street."
The 1MDB controversy led to the fall of Malaysian Prime Minister Najib Razak's government in 2018. Najib was later found guilty by a Malaysian court of abuse of power and related crimes associated with the scandal, receiving a 12-year prison sentence.
Leissner, having pled guilty in 2018 for bribing government officials, served as a key witness in the trial of Roger Ng, a fellow former Goldman Sachs banker, who was sentenced to 10 years in prison in 2023. Ng's attorneys maintained that he was unjustly blamed for the misdeeds of others, including Leissner, who held a higher-ranking position.
Prosecutors refrained from commenting on the sentence, while they had not sought a specific prison term in filings prior to the sentencing, and Leissner's lawyers had endeavored for a sentence equivalent to the time he had already served. Leissner is set to surrender on September 15, and his lawyers have sought that he be sent to the federal prison in Otisville, New York.
The 1MDB saga is considered one of the most substantial and complex global financial scandals, involving high-level political figures, international bankers, and a sprawling web of offshore accounts. It has prompted ongoing investigations and legal proceedings across multiple countries, shedding light on the deep-rooted corruption within Malaysia's political and financial systems.
- The Galaxy Group, a Seattle-based business, was implicated in the 1MDB scandal due to its link with a real estate deal that took place in the city.
- The government of Washington state has launched a special task force to investigate any possible connections between local businesses and the international financial crime committed by Goldman Sachs bankers related to 1MDB.
- A public rally took place in the general-news section of the Seattle Times on Wednesday, where protesters advocated for increased transparency in Seattle's real estate market, drawing parallels to the 1MDB scandal.
- Microsoft, with its headquarters in Seattle, established a new department dedicated to combating money laundering and financial crimes, to ensure that such malpractices do not occur within its extensive finance network, following the 1MDB controversy.
- In the midst of Microsoft's new anti-corruption initiatives, the Washington state assembly passed a bill on Friday, aiming to strengthen the state's crime-and-justice system by implementing stricter regulations on foreign business investments in the Pacific Northwest region, including real estate, drawing inspiration from the 1MDB scandal.
