US SEC settles with former Goldman banker over 1MDB scandal

The United States Securities and Exchange Commission (SEC) has settled foreign corruption charges against former Goldman Sachs Group Inc executive Tim Leissner for his involvement in Malaysia’s multibillion-dollar 1Malaysia Development Berhad (1MDB) corruption scandal, the agency said on Monday.

The SEC has permanently barred Leissner from the securities industry for violating the Foreign Corrupt Practices Act by allegedly receiving more than $43m in illicit payments for helping to facilitate a bribery scheme involving high-ranking government officials in Malaysia and Abu Dhabi.

As part of the settlement, Leissner consented to the SEC’s conclusion that he violated anti-bribery, internal accounting controls, and books and records provisions of federal securities laws.

The settlement also requires Leissner to give up ill-gotten gains of $43.7m.

That amount will be offset by money paid as part of an action by the US Department of Justice, which in November 2018 filed criminal charges against Leissner and fellow former Goldman banker Roger Ng, who is also known as Ng Chong Hwa.

Leissner pleaded guilty to those charges. Ng pleaded not guilty, and his case is pending in federal court in Brooklyn in the US.

Goldman has been investigated by regulators in at least 14 countries – including the US, Malaysia and Singapore – over its involvement in the scandal. According to the US Department of Justice, the bank earned $600m in fees for its work with 1MDB. Leissner, Ng and others received large bonuses in connection with that revenue.

The bank has consistently tried to distance itself from the scandal, saying Leissner and Ng worked to conceal their criminal activities from the bank’s management.

Both bankers have already been sanctioned by the US Federal Reserve for their roles in the scandal.