Goldman Sachs Paid $1.6 Billion in Bribes to Steal $6.5 Billion from Malaysia’s People
A global investment bank deliberately corrupted two governments, looted a national development fund, and then spent years lying to its own compliance team to keep the money flowing. This is the federal criminal case they couldn’t make disappear.
What a Billion Dollars Stolen from a Country Actually Looks Like
1MDB was not a hedge fund. It was not a speculative venture for wealthy investors who knew the risks. It was created by the Government of Malaysia, funded by Malaysian sovereign debt, and was supposed to invest in the country’s future: infrastructure, energy, economic development for ordinary Malaysian citizens who had no seat at the table and no say in how their government borrowed money in their name.
When Goldman Sachs arranged three bond deals that raised $6.5 billion for 1MDB, Malaysians were the ultimate counterparty. Their government was taking on debt. That debt would need to be repaid. The money raised was supposed to flow into Malaysian energy assets, into jobs, into the national economy. Instead, within days of each bond closing, hundreds of millions of dollars were rerouted into shell companies in the British Virgin Islands, controlled by a small group of corrupt officials and one well-connected Malaysian financier named Jho Low.
From the very first bond deal, Project Magnolia, $576 million out of roughly $907 million transferred to 1MDB was immediately moved to a shell company that mimicked the name of a real Abu Dhabi government entity, Aabar, but had no actual connection to it. The money went to officials. It went to relatives of officials. Approximately $60 million went to a U.S. motion picture company partly owned by a close relative of the Malaysian prime minister, used to finance Hollywood productions. The wife of the Malaysian prime minister was taken jewelry shopping in New York. Goldman’s own banker, Leissner, wired $4.1 million to a New York jeweler to cover the bill.
The people of Malaysia did not get their energy infrastructure. They got the debt. The 1MDB fund later collapsed into a cascade of missed payments and auditor resignations that shook Malaysia’s financial credibility for years. The economic cost of that collapse fell on citizens who never knew Goldman Sachs was running a bribery network in their name, who never benefited from a single dollar of the $6.5 billion, and who had no mechanism to hold anyone accountable in the immediate aftermath because the very officials who were supposed to protect them were on the payroll.
There is also a quieter loss that does not show up in any court document. When a government development fund is secretly looted by the people running it, the projects that were supposed to happen simply do not. The clinics that needed upgrading. The rural electrification projects. The industrial investments that would have created work for people whose wages have been stagnant for a generation. Those losses have no line item. They are invisible in the federal charging documents. They are the cost of a deal that Goldman booked at over $600 million in fees.
The Goldman employees who ran this scheme used personal email accounts so their messages would not show up in corporate systems. They arranged introductions at private email addresses and were explicitly told to keep Jho Low’s name off the correspondence. They knew. The compliance officers who raised red flags knew, and when they pushed back, they were pressured by the deal teams and ultimately overruled. One compliance officer wrote that it was “seldom that one sees a vendor report which so clearly states that we should exercise extreme caution.” Goldman kept going anyway. The message to every compliance officer inside every major bank was written into the record that day: the business side wins.
They Said It Out Loud: Verbatim Quotes from the Federal Record
The following quotes come directly from the federal criminal information filed against Goldman Sachs in the Eastern District of New York, Case No. 20-437. Nothing has been paraphrased. These are the words Goldman’s own employees put in writing or said on recorded phone lines.
“This has been an exceptionally trying experience I have to admit, and I believe that no matter what we do [Goldman PWM representative] is not willing to accept that we are not in a position to onboard this prospect . . . I do not believe we will ever be able to get comfortable with this matter. I’d like to shut this down once and for all . . . It is seldom that one sees a vendor report, which has been backed up verbally by them, that so clearly states that we should exercise extreme caution.”
- This is a Goldman regional head of compliance writing internally in a March 13, 2010 email. The subject is Jho Low, Goldman’s behind-the-scenes deal fixer. The compliance officer is explicitly stating that every piece of due diligence, every vendor background report, every verbal confirmation is screaming to walk away.
- Despite this email, Goldman’s banking division kept pressure on the compliance team to approve Low. He was formally rejected, then sought again through different offices. The compliance officer’s warning was not a stopping point. It was an obstacle the business side worked around.
- Two years later, Low was the central figure in a $1.75 billion bond deal that Goldman approved, earned $192.5 million in fees from, and for which Low directed over $576 million in proceeds directly to a shell company he helped control.
“To be clear, we have pretty much zero appetite for a relationship with this individual” and “this is a name to be avoided.”
- These are two separate senior Goldman employees, one a high-ranking compliance MD and one a high-ranking Business Intelligence Group (BIG) MD, speaking in a March 11, 2011 email chain about yet another attempt to onboard Jho Low through Goldman’s Singapore office, made without referencing the prior rejection.
- Goldman’s own internal controls had already flagged Low’s source of wealth as unverifiable. The Singapore attempt was a workaround. It failed. Approximately one year later, Goldman ran its first $1.75 billion bond deal with Low as the de facto deal architect and bribe coordinator.
- These quotes prove that the danger Low represented was institutionally understood at the highest levels of Goldman’s control functions. Continuing to work with him after these documented warnings makes the subsequent conduct harder to attribute to ignorance.
“I was told Jho Low attended the meeting you had with [IPIC Official 1] . . . that was wrong.” [Leissner responded that he had “hand delivered a letter by the Prime Minister of Malaysia to [IPIC Official 1] and the Crown Prince.”] “I guess Low will have had a hand in fixing that you were able to carry the letter from the Malaysian PM . . . Important we have no role on our side for Low and we should ask that any payments from any of [the] participants to any intermediaries are declared and transparent.”
- This exchange is between Employee 2, a senior BIG executive who also advised Goldman’s Firmwide Capital Committee (FWCC), and Tim Leissner, on April 4, 2012, the same day as a critical FWCC committee meeting where Leissner formally lied about Low’s involvement in Project Magnolia.
- Employee 2 is directly telling Leissner that Low being involved in securing access to Abu Dhabi government officials is itself a red flag requiring disclosure of all intermediary payments. Leissner agreed with this admonishment in writing. That same day, Leissner had already falsely told the committee that Low’s role was limited to setting up one meeting.
- This quote demonstrates that Goldman’s compliance architecture was not just bypassed but actively deceived by a senior executive in real time, and that the deception was documented in writing and still not escalated or investigated.
“the main reason for the delay for [IPIC] not having funded their three billion into the JV with 1MDB is [Abu Dhabi Official 1] is trying to get something on the side in his pocket . . . I think it’s quite disturbing to have come across this piece of information . . .”
- Employee 3, a Goldman Participating Managing Director who had worked on the 1MDB deals, said this on a recorded Goldman phone call on approximately May 8, 2013. He is describing active bribery extortion by a senior Abu Dhabi official connected to the $3 billion Project Catalyze deal.
- The senior Goldman executive on the other end of the call responded: “What’s disturbing about that? It’s nothing new, is it?” Employee 3 then agreed that it was nothing new. This conversation happened on Goldman’s recorded phone lines. No escalation followed.
- This is Goldman’s institutional attitude to active bribery by a foreign official captured on tape. The response from leadership was not to investigate or report. It was to normalize. This recorded exchange was later cited in the federal charging document as evidence of Goldman’s failure to escalate known criminal conduct under its own internal policies.
“There definitely was no intermediary on any of the trades. The blogs in Malaysia always try to link a young Chinese business man [sic], Jho Low, to 1MDB. That is not the case other than he was an advisor alongside other prominent figures to the King of Malaysia at the time of the creation of 1MDB.”
- Leissner sent this in written response to a senior Goldman executive’s email asking about reports of an intermediary on the bond trades, dated approximately April 24, 2013. At this point, Project Magnolia and Project Maximus had already closed and the bribery scheme was well underway. Project Catalyze was about to be approved.
- This statement was a direct lie. Leissner knew Low was the central bribe coordinator for every deal. Low had arranged the London meeting where the bribery plan was laid out. Low had routed over a billion dollars in proceeds to corrupt officials. Leissner himself had received tens of millions of those proceeds through accounts he and his relative controlled.
- This response ended Goldman’s inquiry. The charging document specifically notes there was no follow-up by Goldman’s control functions about Low after receiving this email. A single false sentence in an email closed the investigation.
“Yes, double standard, and it looks stupid.”
- Employee 2, the BIG executive and FWCC advisor who had directly cautioned Leissner about Low’s involvement in 2012, said this on a recorded call in approximately January 2016, during a discussion with Employee 3 about how compliance violations by well-connected bankers like Leissner and Employee 1 received minor repercussions while less favored employees faced serious consequences for similar behavior.
- Employee 2 also acknowledged in this call that searching Leissner’s email, which they eventually did in connection with a separate, later incident involving an intermediary, “seems to me should have been done ages ago.” This is a senior compliance officer admitting that a basic investigative step they were capable of taking during the 1MDB deals was simply not taken.
- This call, combined with the May 2013 call about Abu Dhabi Official 1 wanting money “in his pocket,” demonstrates a pattern: Goldman employees with compliance responsibility knew, said so out loud on recorded lines, and were not required to act. The institution protected the revenue stream.
“Making an introduction to [Leissner] and [Ng]’s private e-mail accounts. Please exclude me from the e-mail list going forward.”
The above is Jho Low’s instruction in a January 23, 2012 email, arranging an introduction between Goldman’s senior bankers and a high-ranking 1MDB official. Low set up the deal introduction through personal email addresses and then explicitly removed himself from the chain. Goldman bankers complied. The federal charging document says Goldman’s control functions would have discovered this use of personal email for Goldman business had they searched Leissner’s communications, which they had the capacity to do and chose not to.
Who Got Hurt and How: The Damage Beyond the Courtroom
Public Health and Institutional Trust
When a national development fund is systematically looted, the downstream damage to public health and welfare is structural. 1MDB was Malaysia’s mechanism for funding large-scale economic and social development using sovereign debt. The following documented harms flow directly from its corruption.
- 1MDB was established specifically to pursue “investment and development projects for the economic benefit of Malaysia and its people,” according to the charging document. The looting of over $1.6 billion in proceeds through the bribery scheme meant those projects either did not happen or were funded by additional borrowing that compounded Malaysia’s sovereign debt burden, a debt carried by Malaysian taxpayers.
- The scale of the theft required a comprehensive cover-up inside Malaysian government institutions. Officials at 1MDB who were supposed to oversee the fund were themselves bribed, meaning the internal institutional checks on the fund’s use of public money were deliberately disabled. Malaysian citizens had no functioning watchdog over billions of dollars borrowed in their name.
- The charging document describes officials being directed to “delete from email and destroy once done” communications related to the deals. This systematic destruction of records prevented any post-hoc accountability through normal government auditing channels, further eroding the integrity of Malaysia’s public financial institutions.
- A Goldman banker paid over $4 million to a New York jeweler on behalf of the Malaysian prime minister’s wife. The funds were traced directly to Project Catalyze bond proceeds: money borrowed by the Malaysian government, ostensibly for national development, spent on luxury jewelry for the head of government’s household. Public trust in the government that was overseeing 1MDB was the cost.
- Goldman’s compliance officers documented that Jho Low posed risks severe enough to warrant rejecting him as a client on multiple occasions. By allowing those same risk flags to be overridden in pursuit of deal fees, Goldman demonstrated to its own staff that compliance is negotiable above a certain revenue threshold. That institutional message ripples outward into every subsequent deal those employees touch.
“What’s disturbing about that? It’s nothing new, is it?” A senior Goldman executive, on a recorded call, after learning a foreign government official was extorting bribe money from a deal Goldman was involved in.
Economic Inequality
The financial architecture of this scheme was specifically designed to move enormous sums of public money from a developing-country sovereign fund into the private accounts of a small number of already-powerful individuals. The distributional impact of that transfer is direct and documented.
- Goldman earned over $600 million in fees and revenue across its divisions from the three bond deals plus related transactions. This represented one of Goldman’s most profitable engagements in Southeast Asia at the time. The source of those fees was a government development fund financed by Malaysian sovereign debt. Goldman’s profit came at the direct cost of Malaysia’s fiscal capacity.
- Approximately $681 million was transferred to accounts controlled by or associated with the Malaysian prime minister, either directly or through a close relative’s shell company. That is approximately 10 percent of the entire $6.5 billion raised, transferred to the household of the head of government, drawn from a fund that was supposed to build national infrastructure.
- The Abu Dhabi officials who provided the guarantee structure that made the bond deals feasible for Goldman received hundreds of millions of dollars in bribes: Abu Dhabi Official 1 received roughly $472 million across the three deals combined. These were government officials of a wealthy sovereign wealth fund who extracted private gain from a transaction that was supposed to serve Malaysian public welfare.
- The bond proceeds were used to finance Hollywood film productions through a U.S. motion picture company partly owned by a close relative of the Malaysian prime minister. Approximately $60 million from Project Magnolia alone was transferred to this company for film financing. Malaysian sovereign debt financed American entertainment industry investments for the benefit of a foreign political family.
- The Goldman bankers who ran the bribery network, Leissner and Ng, personally received tens of millions of dollars through shell company accounts. Leissner directed approximately $51.96 million from Project Magnolia proceeds to an account he and his relative controlled. This was wealth extracted from a public fund by a private banker employed to serve as a fiduciary.
- Goldman’s fees on the three deals were structured with Goldman purchasing the entire bond issuance at a discount and reselling to investors, pocketing the spread. For Project Magnolia, Goldman booked $192.5 million in fees on a $1.75 billion deal: an 11 percent fee on a single bond transaction, far above standard market rates. The charging document implies this premium was enabled specifically by the bribery scheme that removed competitive pressures and regulatory oversight.
What $600 Million in Fees Actually Cost
Total value of bribes conspired to be paid to foreign officials across Malaysia and Abu Dhabi
Total raised via three bond deals ostensibly for Malaysian national development
Duration of scheme (2009-2014) before federal charges were filed in 2020: 11 years of delayed accountability
What You Can Do About It: Watchlist, Pressure Points, and Resistance
Goldman Sachs was charged as a corporation; its shareholders, its current and future clients, and the regulators who oversee it are all leverage points. The individuals who ran this scheme were employed by Goldman for years with documented red flags in their records. Here is where the accountability pressure belongs.
Key Roles Named in the Federal Record
- Tim Leissner, Participating Managing Director and Chairman of Southeast Asia at Goldman. Personally lied to Goldman’s oversight committees, personally directed bribe transfers from personal email accounts, and personally received tens of millions in proceeds through shell company accounts he controlled.
- Roger Ng (Ng Chong Hwa), Managing Director of Goldman Malaysia and Head of Investment Banking. Present when Leissner lied to the FWCC committee about Jho Low’s involvement and did not correct the false statement. Received bribe proceeds through a relative’s shell account.
- Employee 1, identity known to the U.S. government and Goldman but anonymized in this charging document. Held leadership positions in Goldman’s Asia operations and worked directly on the 1MDB transactions alongside Leissner and Ng. Described as “problematic” from a compliance perspective by a Goldman BIG executive on a recorded call.
- Employee 2, high-ranking BIG executive and FWCC advisor. Was directly told by Leissner that Jho Low had a hand in securing Goldman’s access to Abu Dhabi officials. Acknowledged on a recorded call that searching Leissner’s email “should have been done ages ago.” No escalation followed.
Watchlist: Regulatory Bodies with Active Jurisdiction
- U.S. Department of Justice (DOJ), Fraud Section: Filed this case. Continue tracking resolution of individual prosecutions and corporate remediation terms.
- U.S. Securities and Exchange Commission (SEC): Goldman is a registered SEC issuer. The FCPA charges implicate Goldman’s disclosure obligations to the SEC. Monitor SEC enforcement actions related to this matter.
- Financial Crimes Enforcement Network (FinCEN): The shell company and correspondent banking wire architecture used in this scheme passed through U.S. financial institutions. FinCEN’s anti-money laundering oversight is directly implicated.
- Federal Reserve / OCC: Goldman Bank USA is a federally supervised banking entity. The conduct of its parent company and affiliated subsidiaries in this scheme falls within bank regulatory oversight scope.
- Malaysian Anti-Corruption Commission (MACC): Malaysian government officials received hundreds of millions in bribes in this scheme. MACC has parallel jurisdiction and international cooperation obligations with the DOJ.
Direct Resistance: What You Can Actually Do
- Divest and pressure pension funds. Goldman Sachs equity is held by public pension funds across the United States. If your pension, union, or university endowment holds Goldman stock, demand your fund managers vote against board resolutions that shield executives from accountability for FCPA violations and adopt proxy voting policies that support shareholder derivative suits in cases of documented criminal conduct.
- Support Malaysian civil society organizations working on 1MDB accountability and sovereign debt transparency, including those documenting the developmental cost of the looting for communities that lost infrastructure investment. International financial accountability advocacy organizations can connect you to those networks.
- Demand legislative action on corporate criminal liability. This case charged the parent Goldman Sachs corporation, which is meaningful. Push your representatives to support legislation that strengthens deferred prosecution agreement terms, mandates individual executive liability in FCPA cases, and requires corporate criminal convictions to affect banking licenses rather than producing fine-and-continue outcomes.
- File public comments with the SEC on any Goldman-related rulemaking or enforcement matter. Public comment records are part of the regulatory file and signal organized civic attention. The SEC EDGAR system allows anyone to locate Goldman’s regulatory filings and the associated comment periods.
- Organize locally around correspondent banking. The wire transfers in this case moved through U.S. correspondent bank accounts. Community reinvestment advocates and local banking accountability organizations can raise the question of what due diligence requirements apply to large banks that process foreign wire transfers connected to sovereign fund transactions.
The source document for this investigation is attached below.
I’m gonna be honest, it’s entirely possible that the above PDF upload isn’t being displayed properly. My preview is currently showing as only the first page being readable, but you should still be able to download the entire 36 page thing and read the story from there. Or you can read any one of the hundreds of news stories already written about this scandal, because it’s by far the most well-known corporate misconduct that I’ve so far written a blurb about.
There is also this:
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