A former Goldman Sachs banker was sentenced yesterday to two years in federal prison for his role in Malaysia’s giant 1MDB corruption scandal.
According to a report by Bloomberg, Tim Leissner pleaded guilty in 2018 to one count of conspiring to violate bribery laws and conspiring to launder money. He faced up to 25 years in prison.
At his sentencing in Brooklyn Federal Court, the 53-year-old apologized to the people of Malaysia, whom he called the “real victims” of the 1MDB scandal.
“The funds raised more than a decade ago could have profoundly benefited the nation and its citizens,” he said in a statement read in court and provided by his lawyers, the Associated Press reported. “Instead, due to my greed – and the greed of those involved alongside me – they were misappropriated.”
The 1Malaysia Development Berhad (1MDB) investment fund was established by Prime Minister Najib Razak shortly after he took office in 2009. It later became the subject of what journalists Tom Wright and Bradley Hope in their book “Billion Dollar Whale” dubbed one of “the greatest financial heists in history.” U.S. prosecutors claim that more than $4.5 billion was stolen from 1MDB in the ensuing years by high-level officials of the fund and their associates, with the money concealed within a maze of shell companies and dummy corporations that is still in the process of being traced. The stolen funds bankrolled a series of extravagant purchases, including jewelry, art, a superyacht, lavish Hollywood parties, and luxury real estate, prosecutors claim.
The scandal helped bring down the Najib government in 2018, and the case continues to resonate through Malaysian politics. In late 2021, Najib was convicted of abuse of power and other crimes related to 1MDB and sentenced to 12 years in prison – a sentence that he has worked hard to overturn.
At the time of 1MDB’s formation, Leissner was Goldman’s head of investment banking in Southeast Asia. In “Billion Dollar Whale,” Hope and Wright described the German-born Leissner as “six foot three tall and dashing” – “a star dealmaker” who had “spent a decade generating new business for Goldman throughout the region.”
Prosecutors say that Leissner helped 1MDB raise around $6.5 billion in bond sales. In 2018, he pleaded guilty to bribing government officials in Malaysia and the United Arab Emirates. Leissner was ordered to repay $43.7 million to Malaysia’s government and became a key government witness in the trial of Roger Ng, a fellow former Goldman Sachs banker who was sentenced in March 2023 to 10 years in federal prison on money laundering and bribery charges.
According to Wright and Hope, it was Ng who connected Leissner with the Penang financier Low Taek Jho, also known as Jho Low, the alleged ringleader of the 1MDB theft, who remains an international fugitive. According to a Bloomberg report, a forensic accountant working for the FBI who attempted to trace the 1MDB funds testified in 2022 that Najib “collected at least $756 million, Leissner got $73.4 million, Ng took $35.1 million, and fugitive Malaysian financier Jho Low got $1.42 billion.”
During Ng’s trial, his lawyers acknowledged the scope of the 1MDB case – they described it as “perhaps the single largest heist in the history of the world” – but maintained that prosecutors allowed him to take the fall for crimes committed by others, including Leissner, his boss at the time.
For similar reasons, the Malaysian government reportedly requested Leissner’s extradition last year, a request that it renewed earlier this week, Channel News Asia (CNA) reported on May 26, citing unnamed Malaysian officials. The CNA report added that the Malaysian government was concerned that the Department of Justice was pushing for Leissner to be granted a lenient sentence for his role in the IMDB affair.
Whether the two-year prison sentence is deemed “lenient,” and whether Malaysia might still pursue Leissner’s extradition, was unclear as of press time.