Lloyd Blankfein met with fugitive financier Jho Low in 2013

Blanche Robertson
November 10, 2018

Years before Goldman Sachs Group arranged bond deals now at the heart of globe-spanning corruption probes, the firm's then chief executive officer Lloyd Blankfein personally helped forge ties with Malaysia and its new sovereign wealth fund, according to people with knowledge of the matter.

After the US Department of Justice disclosure last week that a "high-ranking executive" at Goldman Sachs was present at a meeting in 2009 with a financier charged in the 1MDB bribery scandal, the identity has now been revealed. A Goldman Sachs spokesman declined an AFP request for comment.

Mr Blankfein, who stepped down as Goldman Sachs' CEO last month but still serves as chairman, said at a conference in NY last week that he was not aware of senior managers missing red flags in the 1MDB dealings.

The source told AFP that Blankfein and Low attended a meeting in November 2009 hosted by Najib at his hotel in NY while visiting the United States.

That meeting laid the foundation for a commercial relationship between the prestigious investment bank and Kuala Lumpur, the source said.

The meeting at the Four Seasons hotel in NY was set up and attended by two key figures in the 1MDB scandal, Malaysian businessman Jho Low and former Goldman partner Tim Leissner, one person with direct knowledge of the matter said, asking not to be identified as the information is not public. Low remains at large.

Low, 36 years old, also allegedly paid bribes to Malaysian and Saudi officials.

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According to United States prosecutors, the investment bank generated an "above average" US$600 million in fees for its work with 1MDB, which included three bond offerings in 2012 and 2013 that raised US$6.5 billion.

Goldman earned $600 million in commissions as a result.

In 2013, Blankfein, then Goldman's chief executive, attended the meeting at the Mandarin Oriental in NY with about 20 other bankers and government officials, including Low, to discuss a $6 billion bond deal, according to the Wall Street Journal. The discussion covered a broad range of topics.

Another source told AFP that Blankfein also was scheduled to meet Low at a conference in NY on September 25, 2013 but Low did not attend, which contradicts news reports that the two met twice.

David Solomon, who took over Goldman Sachs after Blankfein retired in September, said Wednesday he was alarmed by the charges of corruption against the two former Goldman bankers.

Details from the US Justice Department's investigation suggest that the bank was complicit in Low's efforts to defraud the Malaysian investment firm.

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