Ex-Goldman banker Leissner gets two years in 1MDB fraud case
NEW YORK (Bloomberg): Former Goldman Sachs Group Inc. banker Tim Leissner, who pleaded guilty to helping loot the Malaysian investment fund 1MDB, was sentenced to two years in prison over his role in the massive fraud.
US District Judge Margo Brodie in Brooklyn, New York, imposed the sentence at a hearing Thursday (May 29), calling his conduct "brazen and audacious." Leissner had asked not to go to prison, arguing that his cooperation with prosecutors had resulted in the conviction of a former colleague and billions of dollars in global fines against Goldman.
Leissner, 53, had faced as long as 25 years in prison after pleading guilty in 2018 to one count of conspiring to violate bribery laws and conspiring to launder money. While prosecutors had also pushed for leniency, Brodie cited a letter from Goldman and said, "Without you, it's unclear these crimes would have taken place."
"Your brazen and audacious conduct meant you were in a position to provide substantial assistance to the government," Brodie said. "But in the end, your cooperation does not completely make up for the harm and devastation you knowingly caused through your conduct, which was completely selfish. So some punishment is warranted."
The German citizen was at the centre of what US prosecutors described as one of the largest financial frauds in history, in which billions of dollars were siphoned from the Malaysian investment fund, 1MDB. Additionally, the US said more than US$1bil was diverted from bond proceeds to pay bribes to officials in Malaysia and Abu Dhabi.
But Leissner cooperated with the US and testified as the government's star witness against his former Goldman colleague, Roger Ng, at a 2022 trial. Leissner spent 10 days on the witness stand describing the sprawling fraud. Ng was convicted and sentenced to 10 years in prison.
Leissner's parents and one of his daughters were in court, and he wept briefly while recounting being unable to be with another daughter after she was in a car accident.
"What we did was very wrong," Leissner said. "I take full responsibility for my role in what we did."
His lawyer, Henry Mazurek, lauded Leissner for cooperating with the US, saying he risked his safety to cooperate against government officials in Malaysia and Abu Dhabi who had been bribed.
"Mr. Leissner began his road to redemption, which leads us to where we are today," Mazurek said. "It is time for Tim Leissner to put this trauma behind him."
The judge said Leissner could be removed from the country after he finishes his prison term. Mazurek said after court that Leissner "is prepared to serve his sentence."
Brodie cited the fact that the 1MDB fraud involved staggering sums. A forensic accountant with the FBI who traced diverted funds testified in 2022 that former Malaysian Prime Minister Najib Razak collected at least US$756mil, Leissner got US$73.4mil, Ng took US$35.1mil and fugitive Malaysian financier Jho Low got US$1.42 bil.
At least US$60mil was used to help produce the 2013 Martin Scorsese film "The Wolf of Wall Street." The US Justice Department has recovered at least US$1.4bil in assets, including a boutique Beverly Hills hotel, fine art by Monet, Picasso and Van Gogh.
Low, who was indicted along with Ng in 2018 on charges that include conspiring to launder billions of dollars embezzled from 1MDB, remains a fugitive. Before the US filed charges against him, he denied wrongdoing and said attempts to link him to the 1MDB scandal were "unfounded."
Goldman paid more than US$5bil to settle global probes related to 1MDB, including US$2.9bil in the US, which was one of the largest penalties in history for a violation of US anti-bribery laws. The bank pushed back against leniency for Leissner.
"Leissner's serial lies, fraud and deception at Goldman Sachs continued from the day he first brought the transactions to the firm through the day he left," the bank said in a letter to the court last week. "Mr. Leissner's efforts in this regard are worthy of sanction, not praise."
Leissner still faces potential criminal prosecution in southeast Asia after Malaysia's Home Minister Saifuddin Nasution Ismail said earlier this month that the nation has submitted an extradition request for Leissner.
Brodie directed Leissner to surrender to prison authorities by Sept 15. She had parting words for Leissner before adjourning court.
"There is no question you turned your life around," Brodie said. "I hope that you continue to do so. The sentence I imposed on you today I believe was necessary in light of the breadth of the crimes you committed." – Bloomberg
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