Thursday 28 Mar 2024
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(March 9): Roger Ng, the only Goldman Sachs Group Inc banker tried and convicted in the global 1MDB scandal, was sentenced to 10 years in prison, a milestone in the prosecution of the massive fraud.

Ng, 51, was sentenced Thursday in federal court in Brooklyn, New York, where a jury convicted him last April of conspiring to violate US anti-bribery laws and conspiring to launder money. Prosecutors had sought a 15-year prison term.

The former Goldman managing director and his onetime boss, Tim Leissner, were accused of conspiring with Malaysian financier Jho Low, the bribery scheme’s alleged mastermind. Low, now a fugitive, allegedly paid tens of millions of dollars to officials in Malaysia and Abu Dhabi to clinch bond deals arranged by Goldman, taking US$1.42 billion for himself.

Goldman paid more than US$2.9 billion to US authorities and more than US$5 billion globally for its role in the scam, with its Malaysian unit pleading guilty in the US to a single conspiracy charge. Goldman’s US penalty was the largest-ever for violating the Foreign Corrupt Practices Act.

Ng had said in a letter to US District Judge Margo Brodie on Wednesday that a court-appointed psychiatrist found he suffers from chronic post-traumatic stress disorder after being detained for six months in a Malaysian prison he described as “absolute hell.” He said he contracted malaria there and that the experience was punishment enough, asking Brodie to sentence him to time served, or no additional incarceration.

His lawyer Marc Agnifilo on Wednesday also argued that Ng deserved leniency because the Malaysian government “has been made whole” after Ng relinquished claims to US$35.1 million that it seized from his accounts.  

‘Send a message’

US Attorney Breon Peace’s office had urged the judge to give Ng a long sentence because he was a key player in the conspiracy to loot the Malaysian fund of billions of dollars.

“Roger Ng played a critical role in a massive bribery and money laundering scheme that stole billions of dollars intended for infrastructure and economic projects to aid the Malaysian people,” prosecutors said in court papers. They urged Brodie to “send a message to other professionals in the financial world who are tempted to gain an advantage or to win business through cheating and bribery.”

Jeff Ifrah, a white-collar defense lawyer and expert on federal sentencing guidelines, said in an interview before Thursday’s hearing that convincing the judge to sentence Ng to time served was an uphill battle. He noted that the size of a fraud is a factor in sentencing and that the scale of the looting at 1MDB suggested Ng could get as many as 30 years.

“Once you’re above that range, it’s equivalent to launching a nuclear weapon in Times Square,” Ifrah said. “How much is the judge going to reduce that?”

Next up: Leissner

Leissner pleaded guilty and was the government’s star witness at Ng’s trial. He will be sentenced in September but will likely get less time due to his cooperation. Prosecutors say Leissner made US$73.4 million in the scheme.

Former Malaysian prime minister Najib Razak received US$756 million, and Khadem al-Qubaisi, a former managing director of Abu Dhabi’s state-owned International Petroleum Investment Co, which guaranteed the 1MDB transactions, got US$472.8 million, a forensic accountant with the Federal Bureau of Investigation testified at Ng’s trial.

“The government already sent its message to the world about Goldman when it accepted its money for a deferred prosecution agreement,” Agnifilo wrote Wednesday in urging leniency for Ng. He added that his client’s PTSD was “likely going to be exacerbated by confinement and by any experiences that reactivate his trauma.”

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