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Monday, July 15, 2024 | Back issues
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Deleted emails, luxury spending teed up as evidence for trial on 1MDB fraud

“This is a massive crime, and there are lots of guilty people. He’s just not one of them,” the defense said Monday of indicted banker Roger Ng. 

BROOKLYN (CN) — Three years after the extradition of investment banker Roger Ng to the United States, federal prosecutors laid out their case in Brooklyn, New York, federal court, to convict the former Goldman Sachs executive on one of the world’s biggest financial scandals. 

Najib Razak was prime minister of Malaysia in 2009 when he set up the fund 1MDB, short for 1Malaysia Development Berhad, as a means of driving the country's economy. Just over a decade later, however, the disgraced Najib faces 12 years in prison and several trials still to come after he was convicted of siphoning off money from the fund in a scheme to line his and others’ pockets and bribe government officials in Malaysia and Abu Dhabi to get business deals for Goldman Sachs. 

The only one of the bank’s employees to sit trial for charges related to the scandal is Ng, whose full name is Ng Chong Hwa and who was Goldman’s head of investment banking in Malaysia. 

Accused of raking in $35 million as a result, the 49-year-old faces three counts accusing him of conspiring to bribe foreign officials, launder money and evade Goldman controls. Together these counts could put Ng away for up to 25 years in prison. 

“The defendant saw an opportunity to make millions of dollars by cheating — and he took it,” said Brent Wible, an attorney with the fraud section of the U.S. Department of Justice, in opening statements on Monday.

Both parties talked about Ng’s fugitive co-defendant and the purported mastermind behind the 1MDB scheme, a Malaysian financier named Jho Low who is said to have used the stolen money to buy himself expensive jewelry, paintings by Vincent van Gogh and Claude Monet, and a $250 million yacht, among other trappings of an extravagant lifestyle.

“Jho Low was a young Malaysian social climber who lived lavishly,” Wilde said. 

Ng did some luxury spending of his own, prosecutors allege, saying his $35 million is directly tied to the scheme, along with a 6-carat diamond for his wife and his attendance at a “lavish, celebrity-studded event” with Low in Las Vegas. 

The defense pointed to the spendthrift Low as well but said Ng lived a modest lifestyle by comparison. 

“[Low] wants all the money as soon as possible,” said Marc Agnifilo, “because he wants to have the most over-the-top lifestyle that’s ever been had.” 

Agnifilo, of the firm Brafman & Associates, said Ng warned Goldman about dealing with Low, whose full name is Low Taek Jho, and told the bank to be careful in vetting him before signing him on as a client. 

While Ng denies all charges against him, his former boss Tim Leissner pleaded guilty to violating the Foreign Corrupt Practices Act and laundering more than $2.7 billion diverted from 1MDB. Leissner was ordered to forfeit $43.7 million and will be sentenced later this year. 

Wible called Leissner Ng’s “partner in crime,” and promised jurors would hear from Leissner himself to give an “insider overview” of the corrupt scheme and its players. Prosecutors plan to introduce evidence from Ng’s personal email accounts, which they say he used to hide shady deals from Goldman and later deleted. 

Agnifilo repeatedly pointed the finger at Leissner. He said the former head of Goldman’s Southeast Asia business used long-term extramarital affairs, including one with an executive of a Goldman client, to gain and then profit from his romantic partners’ trust. Leissner also stole $1.5 million from Ng, Agnifilo said. 

“He uses women, he uses false intimacy, and here he’s trying to use my client … to serve his jail time,” Agnifilo said of Leissner.  

When jurors hear recorded conversations that Leissner gathered for the government, they won’t hear any dirt on Ng, the defense attorney said, even though the government was presumably seeking it. 

“Why didn’t they try to make a recording of Roger?” Agnifilo posed. “Wouldn’t that be something the FBI would do backflips to record?”

There’s no denying the crimes surrounding 1MDB, which resulted in multibillion-dollar payments by Goldman and its Malaysian subsidiary on top of the downfall of former Prime Minister Najib. 

“This is a massive crime, and there are lots of guilty people. He’s just not one of them,” Agnifilo said of Ng. 

The government called its first witness on Monday, a managing director at Goldman Sachs who testified about working with Ng and Leissner in the bank’s South East Asian offices. He read emails related to three business transactions between the bank and 1MDB, a total value of $6.5 billion, some of which questioned Low’s and Najib’s involvement. 

The trial in front of Chief U.S. District Judge Margo K. Brodie is expected to last five to six weeks. 

Follow @NinaPullano
Categories / Business, Criminal, Financial, International

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