NEW details of a meeting between former prime minister Najib Razak and an unidentified “high-ranking” Goldman Sachs executive in 2013 could spell fresh trouble for the investment bank, which helped raise billions for 1MDB, reports Bloomberg today.

On Thursday, the United States Department of Justice indicted Tim Leissner, who once headed Goldman Sachs’ Southeast Asia operations, and Ng Chong Hwa, also known as Roger Ng, and another central figure in the 1Malaysia Development Bhd scandal – Low Taek Jho, better known as Jho Low.

Malaysian police arrested Ng on Friday, a day after the DoJ issued a warrant of arrest.

According to allegations in court filings, beginning about 2009 and continuing through 2014, Low, Ng, Leissner and other co-conspirators used Low’s relationships with Najib, his wife, Rosmah Mansor, and children to obtain and retain business for Goldman Sachs.

The bank worked on three bond transactions known internally at the financial institution as “Project Magnolia”, “Project Maximus” and “Project Catalyse”, which generated US$650 million (RM2.75 billion) in fees for the bank.

Najib was in New York in September 2013 for the United Nations General Assembly and met several people arranged by Low, said the DoJ, including a “high-ranking executive” from Goldman Sachs.

The Bloomberg report today cited a meeting at the Time Warner Centre between Najib, Low, Leissner and a senior Goldman Sachs official, who may or may not be aware of the bank’s long-running warnings about Low.

For years, compliance officials at the bank were issuing warnings about Low, said the business portal.

“On the other, Leissner, Ng and some others in Asia were playing fast and loose, hiding their involvement with Low even as they aggressively pursued Malaysian business with him,” it said.

The business culture at the bank, “particularly in Southeast Asia, was highly focused on consummating deals, at times prioritising this goal ahead of the proper operation of its compliance functions,” the DoJ said.

It is the pursuit of growth at the expense of compliance that has landed the investment bank in trouble, Bloomberg said, with the now unidentified banker’s role in what the DoJ terms a “massive global fraud”.

Goldman Sachs said it’s cooperating with the authorities. – November 3, 2018.