A one-time star banker at Goldman Sachs, an executive who at his peak brought in tens of millions of dollars in revenue, is costing the investment bank billions in the mammoth 1MDB scandal.
Tim Leissner, a flamboyant figure in the world of banking who is married to fashion mainstay Kimora Lee Simons, is accused of quarterbacking an alleged conspiracy which started with getting his bank to underwrite $6.5 billion of bond offerings in Malaysia between 2012 and 2013.
While that deal earned the company roughly $600m in fees and trading gains, 40 percent of the $6.5 billion in bonds was allegedly siphoned off by the Malaysian financier Jho Low for bribes of Malaysian officials and to fund his own lavish tastes. Part of that cash, ironically enough given the subject matter, went to finance the Leonardo DiCaprio movie, The Wolf of Wall Street, authorities say.
As the news of the mechanics behind the 1MDB scandal has spread, Goldman Sachs stock dropped significantly. It has raised questions as to how Leissner could have put through such an enormous deal for the bank without the compliance department catching the warning signs.
“The long-term damage to Goldman’s franchise is hard to quantify. Executives say that so far it has been limited to Singapore and Malaysia,” writes The Financial Times‘s David Crow and Laura Noonan. “But the head of a rival investment bank argues that Goldman ‘won’t be as aggressive and as cute as it used to be . . . it will lose its edge.’”
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