As reported in sister newspaper the Financial Times, Mr Leissner faces the ban for breaches relating to the multibillion-dollar scandal at Malaysia’s troubled state investment fund 1MDB, while Standard Chartered and Coutts have both been fined.
Mr Leissner, who joined Goldman in Asia in 1998 and helped raise $6bn for 1MDB with three bond issuances, is being banned by the Monetary Authority of Singapore in relation to an unauthorised reference letter that vouched for Jho Low.
Mr Low was a Malaysian businessman alleged by US authorities to have laundered funds diverted from 1MDB and to have lived a lavish lifestyle on the proceeds.
Mr Low, a businessman with Hollywood ties, has previously denied wrongdoing.
Goldman is not accused of any wrongdoing by the Singapore authority, but the regulator confirmed that it was working with foreign counterparts on an examination of the bank’s role in the 1MDB bond transactions.
Goldman earned a $300m fee for a 2013 bond deal, which raised $3bn. The bank has since become embroiled in a scandal over allegations of grand corruption relating to 1MDB.
Swiss authorities allege that up to $4.8bn was diverted from companies linked to 1MDB. Malaysian Prime Minister Najib Razak has been buffeted by claims that $681m was transferred into his personal bank account.
Mr Najib denies wrongdoing and has been cleared by Malaysia’s attorney-general.
Mr Leissner, who left Goldman in February, managed the client relationship with 1MDB for all of its three bond issues from 2012 to 2013.
A team of Goldman staff, mainly from Hong Kong but also from Singapore, Malaysia and the United Arab Emirates, arranged the bond issues, and they were fully underwritten by London-based Goldman Sachs International, the MAS said.
Mr Leissner was found by the Singapore authority to have issued an unauthorised reference letter, using Goldman letterhead, to a financial institution based in Luxembourg in June 2015.
The letter stated that Goldman had conducted due diligence on Mr Low and his family, and had not detected any money-laundering concerns with respect to either, the Singapore authority stated.
“These statements were untrue and were made by Mr Leissner without Goldman Sachs’ knowledge or consent,” the MAS said.
Marc S Harris, Los Angeles-based lawyer for Mr Leissner, said that his client had been invited by MAS to respond to the allegations against him and looked forward to doing so.
“Prior to today, Mr Leissner had not heard of any contemplated regulatory action by the MAS and had not been contacted by the MAS or given any opportunity to respond to the MAS regarding the allegations raised,” the lawyer’s statement said.
Mr Harris noted that no order or sanctions had been imposed on Mr Leissner by any regulatory authority. MAS said in the statement that it had “served notice of its intention to issue a prohibition order” against Mr Leissner.
Goldman today (2 December) said that it was co-operating with the MAS, and defended its response to the affair.
“Today’s announcement refers to a matter we discovered in January of this year and identified as a clear violation of the firm’s standards,” it said in a statement.
“At that time we promptly took steps to separate Mr Leissner from the firm and reported the matter to regulatory authorities in several jurisdictions, including Singapore.”
emma.hughes@ft.com
