Mr Tim Leissner

Investment banker at the eye of scandal

Mr Tim Leissner
Mr Tim Leissner
Jho Low
Jho Low

Tim Leissner, an ace US investment banker bringing in tens of millions of dollars in revenues, pleaded guilty to bribery, conspiracy and money laundering charges in connection with a vast fraud at Malaysia’s State Development fund 1Malaysia Development Berad (1MDB scandal, his actions make him the pariah inside the bank and pose the greatest threats to Goldman Sachs partners reputation in its history.

This is the not the first time Goldmab Sachs has been embroiled in crisis, in 1990s it faced severe criticism for its role in the collapse of Robert Maxwell’d media empire and in 2010 it was fined $500m for misleading investors over Abacus, a mortgage backed security that it sold in the run upto the financial crash.

Goldman Sachs is under scrutiny overt its role of underwriting $6.5bn of bond offerings for 1MDB in 2012 and 2013, a service for which it reaped $600m in hefty fees and profited from trading gains.

After the money was raised $2.7bn was allegedly siphoned off by the Malaysian financier Jho Low, who is accused of masterminding the fraud, to pay for lavish lifestyle and to bribe Malaysian officials. The cash allegedly ended up in Van Gogh paintings, Beverley Hill mansions and even financed the Wolf of Wall Street movie – a tale of financial excess.

Goldman’s extensive compliance operation failed to prevent Mr Leissner’s operations, as the bank now attempts to distance itself from the alleged fraud.

Leissner as part of his guilty plea said that concealing things from compliance staff was “very much in line” with the culture of the bank. His former deputy Roger Ng, has also been charged in the US, as has Mr Low, Mr.Ng fighting a US extradition request, also faces charges in Malaysia which he has denied.

Najib Razask, Malaysia’s former Prime Minister, is accused of receiving $681m of the funds in his bank account and is facing almost 40 separate fraud charges, corruption, money laundering and criminal breach of trust which he denies.

As the details of the scandal was revealed investors have dumped shares in Goldman Sachs, wiping more than $8.5bn off its market value in the past month. The bank is now under investigation by the US Department of Justice and faces a lawsuit brought by Abu Dhabi, which was guarantor of two of the bonds. Malaysia’s attorney-general has filed criminal charges against Goldman, Mr Leissner and Mr Ng seeking fines of over $3bn. The country’s finance minister said that the bill to Goldman should be closer to $7.5bn.

DoJ wrote in criminal charges against Mr. Low said “ the 1MDB case identified the environment at Goldman’s Asian operation as factor in the fraud as the business culture was highly focused on cosummating deals, at times prioritising this goal ahead of the proper operation of its compliance functions.”

Goldman insisted it had no knowledge that Mr. Leissner was party to the alleged conspiracy to misappropriate 40 per cent of the proceeds from the bond offerings, or that Mr Low was acting as a middle man to grease the wheels of the deal, despite a decision by Goldman’s private bank in 2010 to reject Mr Low as a client as they could not validate the source of his wealth.


Alhtough Mr Low has maintained his innocence, but his whereabouts remain unknown. After the US indictment, a spokeperson for him said the 1MDB bond offerings were “undertaken openly and lawfully between experienced, well-regulated financial institutions and government entities”.


The size of any penalty will depend in part on whether Goldman’s lawyers can convince prosecutors that Mr Leissner was a rogue employee, rather than the product of an organisation where the deal mattered above all else.



Dan Dees , Goldman’s co-head of investment banking globally, was a senior executive in the Asian region and Mr Leissner’s boss when all three 1MDB deals were completed and Stephen Scherr, Goldman’s recently appointed chief financial officer was global head of the bank’s financing group in New York between 2008 and 2014.

Twenty years ago Goldman hired a bright energetic banker with German middle-c;lass upbringing, Mr Leissner, a new vice-president with an inpecable CV that boasted stints at JPMorgan and Leiman Brothers,

Some former colleagues say they became wary of Mr. Leissner after he gained a reputation as a womaniser, despite being married to a Goldman co-worker. In one instance Mr Leissner was accused of having an affair with an executive perhaps giving extra customer service at a Malaysian company the bank was advising.

He also had an affair with Anis Jamaludin, the daughter of a powerful Malaysian politician, Tan Sri Jamaluddin Jarjis, who died in a helicopter crash in 2015. Mr Leissner arranged an internship for her at Goldmabn in 2010.