One of the most interesting Foreign Corrupt Practices Act (FCPA) criminal trials is underway in New York, that of Roger Ng. Trial preparation and trial reporting efforts were led by Law360 and its lead reporter Stewart Bishop and much of the information in this post comes from this site. Unfortunately, he’s behind a paywall, so if you want to follow him in the future, you’ll need to subscribe. According to Bishop, Ng was charged with conspiracy to violate the FCPA and money laundering conspiracy with his employer Goldman Sachs Group, Inc., his former Southeast Asia chairman Tim Leissner and financier Jho. Low. The charges were bribing “Malaysian and Emirati officials and circumventing internal accounting controls at Goldman, which underwrote more than $6 billion in bonds issued by 1MDB in three offerings in 2012 and 2013. Leissner pleaded guilty to his role in the alleged scheme, while Low remained overseas, out of reach of US authorities for now.
The prosecution case revolves almost exclusively around the testimony of Leissner, one of the most pathological liars to ever grace the witness stand. Indeed, Matthew Goldstein, writing in The New York Times, reported this question from Ng’s defense attorney to Leissner, “Do you think you are good at lyingLeissner wavered on the question but admitted he had “lied a lot”. Goldstein quoted Rebecca Roiphe, a former prosecutor and New York Law School professor specializing in legal ethics, who said “he be difficult to trust such a witness, but “it is not a fatal blow”. She said a prosecutor can argue that a witness is “a horrible person” and “a serial liar” who had “a Jesus-coming moment.” It can work when you have really bad people who have lied a lot,” she said.
What are Leissner’s confessed lies? Leissner admitted in cross-examination that he presented “a bogus divorce decree to his now estranged wife, model and fashion designer Kimora Lee Simmons, to marry him eight years ago.” The defense attorney also asked Leissner to “recount the many ways he cheated on his wives, especially Mrs. Simmons. Mr Leissner admitted he used an email account in the name of his second wife, Judy Chan, to communicate with Ms Simmons while he was dating her, and that he was still married to Ms Chan when he and Mrs. Simmons got married. . (Mr. Leissner was also legally married to another woman when he married Ms. Chan.) “Leissner also admitted that about $10 million of his ill-gotten 1MDB gain was used to ‘buy a 10 million dollars for one of his girlfriends (while she was married) so she wouldn’t go to the authorities.
Of course, Leissner now maintains he’s “telling the truth about Mr. Ng, who prosecutors say helped line the pockets of Abu Dhabi officials and powerful Malaysians close to then-Prime Minister Najib. Razak”. Leissner testified “Mr. Ng was his primary contact at Goldman, which earned approximately $600 million in fees for arranging the $6.5 billion in bond transactions for the fund. “Roger made him one of his clients,” Mr. Leissner said. He testified that Mr. Ng held numerous meetings to plan the scheme, including one at Mr. Low’s flat in London during which Mr. Low drew boxes on a piece of paper with the names of all officials who receive bribes and gifts. For helping arrange the payments, Leissner said, he raised more than $80 million. Prosecutors argue that Mr. Ng’s share was $35 million. Leissner tried to portray Ng as someone very close to Low, even placing Ng” at a star-studded 31st birthday party that Mr. Low threw for himself in Las Vegas in 2012, although Mr. Ng did not appear. not on the guest list.
But here’s the #1 problem with this testimony, Ng always worked for and under Leissner during the 1MDB scandal and not the other way around. Leissner admitted under cross that “he – not Mr. Ng – oversaw the payment of most of the bribes”. As Roiphe later told Goldman, “In a case like this, you hope to avoid a situation where you have a cooperator testifying against someone who is a subordinate.”
Then there’s issue #2 for the prosecution, which is the government’s claim that Ng received some $35 million in ill-gotten gains in connection with the 1MDB scandal. Ng’s attorneys responded that any money received by Ng was repayment of a debt one of Leissner’s wives owed to Ng’s wife. The prosecution must show that Ng received this money.
As Bishop further reported, the prosecution concluded its direct case with “An FBI agent described on Tuesday how the bribes were allegedly paid by Malaysian sovereign wealth fund 1MDB to the former chief executive of Goldman Sachs, Roger Ng and others”. Bishop wrote the money allegedly from Chan Leissner’s account, “to another shell company in the name of Ng’s mother-in-law, originally called Silken Waters but later changed to Victoria Square”. Then came another network of shell company transfers to entities controlled by a combination of Ng, his wife, Lim Hwee Bin and Lim’s mother. About $300,000 was spent on diamond jewelry, another $20,000 on an hourglass and more than $200,000 on buying Bristol Myers Squibb stock, according to the government. Finally, an additional $3.15 million was paid into another “account that the government could not identify”. None of this is $35 million.
I have all that. Does this money transfer convince you that Ng was the mastermind Leissner and the government are trying to pass off as him? By putting one of the all-time great liars on the stand as a key witness with only that as “documented” evidence, the government is risking everything on Leissner’s testimony; that it will be believable and believable and will not taint the government’s case in the eyes of a juror so that the government can obtain a guilty verdict. Don’t forget that it doesn’t take 12 to pay, but only one.
There are a lot of other amazing things happening in the Ng trial, but I’ll save those for another day.