The Roger Ng Foreign Corrupt Practices Act (FCPA) trial has now concluded its jury phase. Last week the jury came back with a stunning victory for the prosecution with a guilty verdict against defendant Ng. Stewart Bishop, writing in Law360, said the jury deliberated over 16 hours over four days to arrive at the verdict. The trial, which lasted over two months, was one of the most extensive FCPA cases tried in recent memory. Probably the last such big FCPA trial were the two Gun Sting cases where two different sets of defendants were tried in 2011. The jury hung in both cases, the trial judge declared mistrials and the government eventually dismissed all pending charges against the defendants.
In the Ng case there were three clear issues the jury had to wade through to get to its verdict. The first was the veracity or lack thereof of key prosecution witness Timothy Leissner, a serial liar who was the backbone of the government’s trial testimony against Ng. As Bishop noted, “Leissner was pilloried on cross-examination over his admissions to extensive lies for years in both his professional and personal lives. He admitted to being married to two different women at the same time, twice, and lying about it. He also admitted to forging divorce documents and committing immigration fraud, as well as stealing.”
However, Leissner provided crucial testimony against Ng. Bishop noted, “Over the course of 10 days on the witness stand, Leissner said Ng was intimately involved in the scheme and placed him at a key 2012 London meeting with Low, Leissner and others in which Low laid out what government officials — including the former prime minister of Malaysia and an influential sheikh in Abu Dhabi — had to be bribed to ensure the bond deals went through.”
The second issue was the documentary evidence. The reason it was so critical was because it gave the jury evidence to convict Ng but in a way that they did not have to believe or even give any credence to the testimony of Leissner. To present this documentary evidence, the government brought forward FBI agent Eric Van Dorn, a forensic account. As reported by Patricia Hurtado and David Voreacos in Bloomberg, in this phase of the trial and perhaps most “central to the government’s case was an FBI chart showing that Leissner sent $35 million of the booty to a shell company controlled by Ng’s wife, Lim.” It was Van Dorn who explained the chart to the jury.
According to Tarani Palani, writing in The Edge, Van Dorn testified that “on March 14 that transfers of ill-gotten gains were made to entities and accounts under Tan Kim Chin, Ng’s mother-in-law. About US$35.1 million was transferred to the account of Silken Waters Victoria Square, whose beneficiary is Tan. This was effected through four separate transactions over 2012 and 2013 and stemmed from the first and third 1MDB bond deals, codenamed Project Magnolia and Catalyze.” From there, “The money transferred to Silken Waters was then funnelled through various other bank accounts that were either Tan’s bank accounts in UBS and Deutsche Bank or a joint bank account she held with her daughter, Ng’s wife Lim Hwee Bin, in OCBC Singapore and OCBC Malaysia.”
The final issue for the jury was the defense which consisted of Ng’s wife testifying to the source of this $35 million. According to Luc Cohen, writing in Reuters, “Ng’s wife, Hwee Bin Lim, testified on Monday that shortly after Ng began working for Leissner in the mid-2000s, she invested 48 million yuan – about $6 million at the time – at a Chinese company owned by the family of Leissner’s wife, Judy Chan.” It was allegedly this $6 million investment which grew into the $35 million funneled to shell companies controlled by Ng. The first problem for the defense is that Lim was “tied into knots” during her cross, according to one court watcher. But the bigger problem was that Lim, who is a corporate lawyer by professional training, had ZERO documents to back up her claims. She had no agreement with Chan regarding the original investment. She had no annual (or indeed any) statement which would show the status of the investment during the six-seven years the money was invested. Finally, she had no documents when the investment was concluding showing the arrangement was over or even the final payout.
At this point, we do not know who or what the jury believed or who or what the jury did not believe during its deliberations. The jury has not said anything save one comment which was reported by Hurtado as “outside the courtroom a juror who declined to give his name stopped briefly when asked about the outcome. “I have said all I have to say in the courtroom today with my verdict,” he said.” Not very enlightening as to what the jury may or may not have believed.
There will no doubt be an appeal of this verdict. Hurtado reported defense counsel Marc “Agnifilo said, he would challenge the conviction before Brodie, particularly on the charge Ng conspired to violate U.S. anti-bribery laws by circumventing Goldman’s internal accounting controls. During the trial, Agnifilo and prosecutors agreed this was the first time the charge had been considered by a federal jury. “We’ve never been here before — it is all brand new territory,” he said after the verdict.”
What does all this mean for the Department of Justice? First and foremost, it will excise the ghosts of the Gun Sting trial debacles. While this criminal was originally filed several years ago, it could well be a starting point for a reinvigoration of the Yates Memo and the prosecution of individuals in FCPA criminal actions as suggested by Deputy Attorney General Lisa Monaco in her speech before the ABA White Collar Section last October. Procedurally, it demonstrates that even if you have a pathological liar on the witness stand, if you present documentary or other tangible evidence which support their testimony, the jury can believe that the documents or records are not lying. Such documentary evidence can also uphold a verdict on appeal. Finally, if your defense is so implausible as to defy common sense, you had better have something other than a fanciful story and faulty memory to back it up.
But there is still the post-trial motion for significant discovery abuse by the prosecution as well as the legal issues noted above. There is still much to go on down the road.
And Timothy Leissner has yet to be sentenced. His sentencing is set for July 6.