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FINANCE

US regulators ban Goldman Sachs 1MDB duo

US-regulators-ban-GBO

Tim Leissner and Roger Ng have been banned from the banking industry for their role in Malaysian scandal

The Federal Reserve has banned former Goldman Sachs bankers Tim Leissner and Ng Chong Hwa from the banking industry for their participation in a scheme to illegally divert billions of dollars from a Malaysian sovereign wealth fund.

Mr Leissner, who was also fined $1.42mn by the Fed and consented to a permanent ban, pleaded guilty to US criminal charges of conspiring to commit money laundering and breaching the Foreign Corrupt Practices back in August. Both charges related to the his role in the multibillion-dollar 1MDB bribery and money-laundering scandal, which included the misappropriation of $2.7bn of the $6.5bn raised for 1MDB by Goldman.

 Mr Ng, also known as Roger Ng, was indicted in October on similar charges and is currently awaiting extradition from Malaysia. The Fed said his ban would remain in effect “until the Indictment (or any superseding indictment) is finally disposed of, or such prohibition is terminated by the Board of Governors”.

In their order of prohibition against Mr Ng, the Fed detailed how the “negative publicity” created by the criminal sanctions of its bankers, coupled with “the serious nature of the allegations contained in the Indictment, and the particular crime involved, all serve to impair public confidence in Goldman”.

Analysts fear the bank, which is itself is being sued in Malaysia, could be face billions of dollars in fines for its role in the biggest investment banking scandal of the decade. Goldman chief executive David Solomon has apologised to the “people of Malaysia” for his bankers’ conduct, but insisted the firm was not complicit or negligent.

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