Wall Street’s independent regulator banned a former Goldman Sachs banker linked to a Malaysia sovereign wealth fund that was allegedly looted, after he said he wouldn’t cooperate with the regulator’s investigation.
Tim Leissner consented to his ban from the U.S. securities industry.
Leissner didn’t respond to requests from the Financial Industry Regulatory Authority (FINRA) for documents and other information related to his departure from Goldman Sachs in 2016.
He was one of eight individuals Singapore authorities sanctioned for offenses related to 1Malaysia Development Berhad or 1MDB.
He was the former chief of Goldman Sachs (Southeast Asia).
The Monetary Authority of Singapore (MAS) banned him for ten years from March 13, 2017.
MAS said Leissner issued an unauthorized reference letter to a bank in Luxembourg in June 2015 using Goldman Sachs’ letterhead.
The letter vouched for Low Taek Jho, a central figure allegedly involved in 1MDB.
Leissner resigned from Goldman Sachs in February 2016.
In a Letter of Acceptance, Waiver and Consent he signed with FINRA, Leissner said,
I hereby accept and consent, without admitting or denying the findings, and sole for the purposes of this proceeding and any other proceeding brought by or on behalf of FINRA, or to which FINRA is a party, prior to a hearing and without an adjudication of any issue of law or fact, to the entry of the following findings by FINRA . . .
Leissner moved from Singapore to Goldman’s Hong Kong office in November 2011.
Even after his move, Leissner was listed as the representative of Goldman’s Singapore office, MAS said.
In the reference letter Leissner wrote on Goldman Sachs’ letterhead in June 2015, he said: “Goldman Sachs had conducted due diligence on Mr Low Taek Jho and his family, and had not detected any money laundering concerns with respect to Mr Low or his family.”
But MAS said, “These statements were untrue and were made by Mr Leissner without Goldman Sachs’ knowledge or consent.”
Low, a Malaysian citizen, has been tied by U.S., Swiss, and Singapore prosecutors to the diversion of $3 billion or more from 1MDB.
Last year Singapore seized about $88 million in accounts Low controlled.
He has denied wrongdoing.
MAS said Leissner managed the client relationship with 1MDB for its three bond issues from 2012 to 2013. The bond issues were fully underwritten by London-based Goldman Sachs International.
A Goldman team from Hong Kong, Singapore, Malaysia, and the United Arab Emirates handled the work.
Goldman Sachs said it learned about the reference letter for Low in January 2016 and reported it to Singapore authorities.
FINRA’s Letter of Acceptance, Waiver and Consent with respondent Tim Leissner is here (pdf).
Richard L. Cassin is the publisher and editor of the FCPA Blog.