‘Lenient' Leissner jail term may send wrong message, says Johari
PETALING JAYA : The light two-year prison sentence given to former Goldman Sachs banker Tim Leissner for his role in the 1MDB scandal risks sending the wrong message to global financial institutions, says 1MDB asset recovery task force chairman Johari Ghani.
He said institutions such as Goldman Sachs are entrusted with safeguarding the interests of sovereign nations.
'Yet, instead of preventing wrongdoing, they enabled the misconduct that left Malaysia to bear both financial and reputational damage,' Johari said.
He said Leissner's sentencing 'was an opportunity to send a clear and strong global message that white-collar crime will be met with serious consequences. Unfortunately, that opportunity has been missed'.
Leissner, a former Southeast Asia chairman for Goldman Sachs, pleaded guilty in 2018 to a conspiracy to violate the Foreign Corrupt Practices Act of the US, and participating in a money laundering conspiracy, all tied to his role in the 1MDB scandal.
During his sentencing on Thursday, he said he sincerely apologised to Malaysians, saying he had lost his freedom, family and financial independence in the wake of the scandal.
However, Johari said Leissner's light sentence, despite the offence carrying a potential maximum sentence of 25 years, is too lenient given the scale and gravity of the crime.
'Leissner was one of the masterminds in one of the world's most serious financial scandals, which resulted in the misappropriation of billions of dollars from 1MDB.
'He played a central role in facilitating this fraud, abusing both his position and the reputation of one of the world's most prominent financial institutions to carry out this scheme,' he said.
Johari also pointed out that the Malaysian government still has an unresolved dispute with Goldman Sachs over the US$1.4 billion (RM6 billion) asset recovery guarantee arising from the settlement agreement signed in 2020.
'This matter is still under arbitration. (Leissner's light sentence) adds to the public's frustration and reinforces the perception that powerful individuals can escape with minimal consequences,' he said.
Prime Minister Anwar Ibrahim demanded in November last year that Goldman Sachs honour its settlement with Putrajaya.
Johari also said previously that a lack of clarity in the settlement agreement during the Muhyiddin Yassin administration had allowed the bank to evade the full extent of its responsibilities to Malaysia.
He said the New York-based investment bank had taken advantage of ambiguities in the document to sidestep the asset recovery guarantee given to the government under the agreement.
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