PUTRAJAYA: Criminal charges have been filed against 17 current and former directors of three Goldman Sachs subsidiaries.
Attorney-General (AG) Tommy Thomas said the new charges were filed under Sections 367(1) and 179 of the Capital Markets and Services Act (CMSA) 2007.
"The subsidiaries are Goldman Sachs International, Goldman Sachs (Asia) LLC and Goldman Sachs (Singapore) Pte,” he said.
The individuals charged include Richard Gnodde, chief executive of Goldman Sachs International, and Michael Sherwood, vice chairman of Goldman Sachs Group Inc as well as co-chief executive officer of Goldman Sachs international, he said.
Thomas said this in a statement posted on AG's Chambers website.
He said on the Dec 17 and 18, 2018, charges under Section 179 were filed against the subsidiaries and their employees, Tim Leissner and Roger Ng, along with Jasmine Loo Ai Swan of 1MDB and businessman Low Taek Jho, better known as Jho Low.
"The charges were brought against them for "perpetrating a scheme to defraud the government of Malaysia and purchasers of three bonds with a face value of US$6.5 billion which were underwritten and arranged by Goldman Sachs, and issued by subsidiaries of 1MDB, by way of the commission and abetment of false or misleading statements to dishonestly misappropriate billions from the bond proceeds," he added.
Thomas said the accused were directors of these three Goldman Sachs subsidiaries between May 2012 and March 2013, the period during which acts giving rise to the Section 179 charges against their companies took place.
"They occupied the highest executive positions in those three Goldman Sachs subsidiaries, and exercised or ought to have exercised decision-making authority over the transactions of those bodies corporate.
"Custodial sentences and criminal fines will be sought against the accused, given the severity of the scheme, to defraud and fraudulent misappropriation of billions in bond proceeds.
"The other factors were the lengthy period over which the offences were planned and executed, the number of Goldman Sachs subsidiaries, officers and employees involved and the relative value of fees and commissions paid to Goldman Sachs for their multiple roles played in arranging, structuring, underwriting and selling the three bonds," he said
Goldman Sachs has consistently denied wrongdoing and said certain members of the former Malaysian government and 1MDB lied to Goldman Sachs, outside counsel and others about the use of transaction proceeds.
Last year, Malaysia filed criminal charges against Goldman Sachs and two of the US bank’s former employees in connection with 1MDB. The US Department of Justice is investigating the bank for its role as underwriter and arranger of the bond offer.
An estimated US$4.5 billion was misappropriated from 1MDB by fund officials and their associates between 2009 and 2014, the US Justice Department has said.
Tim Leissner, a former partner of Goldman Sachs in Asia, pleaded guilty last August to conspiracy to launder money and conspiracy to violate the Foreign Corrupt Practices Act and agreed to forfeit US$43.7 million.
Malaysia has said it was seeking up to US$7.5 billion in reparations from Goldman over its dealings with 1MDB, set up in 2009 by then prime minister Najib Razak.
Najib, ousted in an election last year, is facing dozens of criminal charges related to 1MDB. He has pleaded not guilty and denied wrongdoing.
The list of the 17 individuals and Goldman Sachs subsidiaries;
Goldman Sachs International:
1.Richard John Gnodde
3. Michael Sydney Sherwood
4.Robin Antony Vince
5.Claes Ake Gustaf Dahlback
Goldman Sachs (Asia) LLC:
6.Oliver Robert Morgan Bolitho
7.Matthew Thayer Freemont-Smith
9.Archie William Parnell
10.Ronald Suk Bae Lee
11.Richard Mark Campbell-Breeden
12.Keith Leslie Hayes
13.Amol Sagun Naik
14.John Michael Evans
Goldman Sachs (Singapore) Pte:
16.Goh Boon Leng
17.Liow Chang Lee