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Former Goldman Sachs chief executive Lloyd Blankfein is the senior executive identified in court papers as having met with the man at the heart of the 1MDB scandal in 2009, two people familiar with the situation told the Financial Times.
The Department of Justice said last week that a “high-ranking executive” at Goldman was present at a 2009 meeting between its bankers and Jho Low, the financier who has been charged for his role in a $2.7bn money laundering and bribery scandal. Court documents did not name the executive.
Goldman has maintained it was duped by some of its Asia-based bankers — two of whom are facing criminal charges— and had no idea that Mr Low was operating in the shadows of deals to raise $6.5bn of debt for state investment fund 1MDB.
Two former Goldman managing directors — Tim Leissner and Roger Ng — have also been charged in connection with their roles in helping the fund raise $6.5bn of debt from investors, just under half of which the DoJ says was misappropriated.
In last week’s indictments against Mr Low and the two former Goldman bankers, the DoJ detailed an occasion when a “high ranking executive” from the firm met with Mr Low.
“It was Lloyd,” said a person with knowledge of the situation. Goldman declined to comment.
The 2009 meeting was hosted by Malaysia’s then prime minister Najib Razak, who has himself been charged in Malaysia with money laundering related to 1MDB.
Mr Blankfein did not have any advance knowledge that Mr Low would be attending the meeting, which was held at the hotel where Mr Najib was staying and included about 12 people, a person familiar with the situation said. Whether the two men actually spoke is unclear.
Mr Blankfein retired in September after 12 years as chief executive, handing the reins to David Solomon. The Financial Times has previously reported that both men were among more than 30 Goldman executives who reviewed the 1MDB debt deals. Company insiders said the deals had been extensively scrutinised, because they involved not only the Malaysian sovereign wealth fund but also Abu Dhabi’s, which was teed up to buy some of the bonds.
Prosecutors in the eastern district of New York charged Mr Low with money-laundering and violating US laws against bribing foreign officials. He remains at large, according to the justice department.
Mr Leissner, who was arrested in June, according to court records, pleaded guilty to two counts of conspiracy to launder money and violate the Foreign Corrupt Practices Act. His lawyers did not respond to previous requests for comment. Mr Ng, who was arrested in Malaysia and faces US money laundering and bribery charges, has not entered a plea, and could not be reached for comment.
In Mr Leissner’s criminal information, he admitted acting “within the scope of his employment” at Goldman and “with the intent, at least in part, to benefit” the bank.
The indictment against Mr Ng also pointed back to Goldman, alleging that the bank’s internal accounting controls “could be easily circumvented” and that its culture, particularly in south-east Asia, was at times focused more on securing deals than the “proper operation of its compliance functions”.
The indictment additionally referred to the conduct of an unnamed Italian managing director — whom sources identified as Goldman partner Andrea Vella. Mr Vella was co-head of the firm’s Asia-Pacific ex Japan investment banking division until last month, when he became the unit’s chairman. He has not been charged but was put on leave following the allegations. He did not respond to requests for comment.
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