The scandal emanating from the 1 Malaysia Development Berhad fund (1MDB) continues to ripple through criminal law enforcement and criminal prosecutions.
Just to remind everyone, last year’s most significant FCPA enforcement case resulted in a $3 billion settlement with the Justice Department, the SEC and other agencies. Tim Leissner, the former Goldman Sachs Southeast Asia Chairman pleaded guilty to conspiracy to money laundering and FCPA violations. Roger Ng, the managing director of Goldman and head of investment banking in Malaysia is awaiting trial in federal court in New York.
At the center of the vast scheme was Jho Low, a Malaysian financier, who has been indicted and charged with conspiracy to commit money laundering and to violate the FCPA. Jho Low has not been apprehended.
Jho Low, Leissner and Ng participated in a vast international corruption scheme over a five-year period in which they paid $1.6 billion in bribes to high-level government officials in Malaysia and Abu Dhabi to obtain lucrative underwriting contracts for Goldman Sachs worth approximately $6.5 billion in three bond raises for 1MDB from which Goldman earned over $600 million in fees.
Fast-forward to last week – a District of Columbia grand jury returned a superseding indictment charging Jho Low and Prakazrel “Pras” Michel, a former rap entertainer, with orchestrating an unregistered, back-channel campaign starting in 2017 to influence the former Trump Administration and the Justice Department to drop the investigation of Jho Low and others in connection with the 1 MDB and to return a Chinese dissident back to China.
Jho Low and Pras Michel conspired with Elliott Broidy, Nickie Lum-Davis and others to conduct an unregistered lobbying campaign under the direction of Jho Low and Vice Minister of Public Security People’s Republic of China to have the 1MDB embezzlement investigation and forfeiture proceedings involving Jho Low and others closed and to have a Chinese dissident sent back to China. Michel and Low are also charged with money laundering conspiracy related to the foreign lobbying campaign.
In May 2019, Low and Michael were initially charged for orchestrating and conducting a foreign contribution scheme in which they funneled millions of dollars of Low’s money into the U.S. presidential election as purportedly legitimate campaign contributions, while concealing the true sources of the funds. To execute the scheme, Michel received Low’s money and contributed it both personally and through approximately 20 straw donors.
The Chinese dissident at the center of this influence campaign has been identified as China critic, Guo Wengui, an ally of Steve Bannon.
Broidy and Lum Davis were charged in the scheme last year. Broidy pleaded guilty to one count of conspiracy to violate the Foreign Agents Registration Act in October 2020. Former President Trump pardoned Broidy on his last day in office. Lum Davis pleaded guilty to aiding and abetting a FARA violation in August.
Low and Michel were accused in 2017 with conspiring to funnel $21.6 million in foreign money to the re-election of former President Obama. Michel disbursed $865,000 from Low to 20 straw donors. Michel is also charged with witness tampering and conspiracy to make false statements to banks. In 2018, Michel “opened multiple accounts at financial institutions in the United States to maintain money funneled into the United States at Jho Low’s direction.”