DoJ investigating German bank's 1MDB dealings

Marco Green
Июля 11, 2019

The US Justice Department is finally investigating Deutsche Bank to see if Germany's biggest bank violated foreign corruption or anti-money laundering laws when it helped 1Malaysia Development Berhad (1MDB) raise US$1.2 billion (RM4.9 billion).

Bloomberg, quoting a Wall Street Journal report, said the probe into alleged corruption and money-laundering is being assisted by former Goldman Sachs banker Tim Leissner, who past year pleaded guilty for his role in the massive scandal.

In an emailed statement, Deutsche Bank said it had fully cooperated with all regulatory and law enforcement agencies that made inquiries about the fund.

The same representative was reported saying that 1MDB made "material misrepresentations and omissions to Deutsche Bank officials" in connection with its transactions with the German bank, adding that the bank's findings were consistent with what was stated in the US Justice Department's civil asset forfeiture documents.

Probes into 1MDB have mainly focused on more than US$6 billion it raised in 2012 and 2013. Goldman Sachs handled the deals, reaping nearly US$600 million in fees.

The bank has since portrayed Leissner as a rogue employee who circumvented the bank's internal controls. Now, the Justice Department expects to start negotiating with the New York-based investment bank soon to potentially resolve a criminal probe, the Journal wrote.

"We do anticipate getting into active discussions with Goldman, at this point, in the near future", Assistant Attorney General Brian Benczkowski, who runs the agency's criminal division, said in an interview.

The insurance company FWD Group, Tan's current employer, said Tan declined to comment when contacted by the WSJ.

Tan left Deutsche Bank previous year, after it discovered communications between her and Jho Low, the Malaysian financier the Justice Department has described as the central player in the 1MDB scandal, it added. U.S. prosecutors are now examining the same executive, according to the Journal's report.

Worldwide financial news wire Bloomberg previously reported her links to Goldman Sachs executive Roger Ng, who introduced Tan to Low Taek Jho, the Penang-born fugitive better known as Jho Low said to have masterminded the misappropriation of 1MDB funds.

It said prosecutors have been investigating similar issues at Goldman, where Leissner, a former managing director, pleaded guilty previous year and admitted to earlier helping siphon off billions of dollars from the fund. As part of the deal, he agreed to forfeit $43.7 million and admitted to bribing officials in Malaysia and the United Arab Emirates to get bond deals for Goldman Sachs.

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