by Tom Wright
In the early phase of his scheme, Low concentrated on mansions and hotels, as well as gambling and parties. In the United States, property agents didn’t have to declare the names of buyers who used cash, and Low had been able to hide behind a wall of shell companies. But there was still the physical property, which was immovable in times of crisis, and Low was beset by a nagging worry someone would find out he owned the Time Warner penthouse or the Bird Streets mansion in West Hollywood. Recently, U.S. real estate news sites had reported on Riza Aziz’s purchase of the Park Laurel but mistakenly named the sellers as Rothschild bankers involved in the transaction, and Low had kept his name out of the media. He also had bought stakes in companies like EMI and Viceroy Hotels; he’d even acquired a British lingerie brand called Myla—apparently Rosmah’s favorite—with proceeds from the 2013 bond. Again, these were assets that could not be easily liquidated.
Even Swiss private banks weren’t the redoubt of secrecy they once had been. In 2013, the U.S. Justice Department launched a program that permitted Swiss banks to avoid criminal prosecution if they agreed to come clean about abetting U.S. citizens to evade tax. Low could sense it was getting harder to use banks; even BSI, which soon would start cooperating with the Justice Department over its U.S. clients, had started to query his transfers, and it would be difficult to rely anymore on Falcon’s Leemann. As the focus on 1MDB got more intense, Low was looking for the perfect movable and untraceable asset.
The art market fit the bill. The Financial Action Task Force viewed the art world, much like the jewelry trade, as one of the last great unregulated financial markets in the world. Its dealers, from small-time auctioneers in New York, Hong Kong, or Geneva to global behemoths like Sotheby’s and Christie’s, were under no legal obligation to disclose the identity of their customers, and even they sometimes didn’t know the beneficial owner behind anonymous shell companies that bought Monets or Rothkos. While Swiss bank secrecy had been eroded, the Geneva Freeport did not have to list its clients. A Swiss art warehouse owner called Yves Bouvier, who was involved in the Geneva Freeport, in 2010 opened a similar fortress for the rich in Singapore, near Changi airport. The New York Times dubbed these entrepôts the “Cayman Islands of the art world.”
Occasionally there was a chink in the armor of secrecy, like in 2013, when Swiss customs officers on a routine inspection of the Geneva Freeport impounded nine artifacts looted from Libya, Syria, and Yemen, ranging from Roman-era bas-reliefs to Greek statues. But for Low, the art world, and these depots shrouded in secrecy, offered a sanctuary.
Low and McFarland often attended auctions in New York, renting skyboxes, secluded rooms overlooking the main auction floor from where they could watch unobserved and make telephone bids in anonymity. Low’s group had a reputation as parvenus at snobbish Christie’s, which was founded in London in the 1700s, and whose employees looked down on the nouveau riche even as the auction house took their money. McFarland sometimes bid for Tanore, and he acquired a Mark Ryden for $714,000 and an Ed Ruscha for $367,000. Christie’s executives saw Low and Tanore as interchangeable and believed the young Malaysian was building a corporate collection. But Low attempted to dissociate himself from these acquisitions—at least on paper—by using Fat Eric and McFarland. For one auction, Low used the Eric Tan Gmail account to reserve a skybox at Christie’s for twelve guests.
“It better look like Caesar Palace [sic] in there,” one employee wrote to a colleague about the skybox. “The box is almost more important for the client than the art.”
That night, Low bought a van Gogh—La Maison de Vincent à Arles—for $5.5 million. The company’s earlier payments to Christie’s, from its account at Falcon Bank, had gone through. But this time, Falcon’s compliance kicked up a fuss over the huge amounts of art purchases that Tanore had been making, and Low—again using the Eric Tan email address—had to apologize to Christie’s for a delay in paying for the van Gogh. In the end, he had to pull money from elsewhere.
In all, between May and September 2013, Low, via Tanore, bought $137 million in art. But Low had picked up more via other channels, such as the van Gogh, as well as works by Lichtenstein, Picasso, and Warhol, and by the end of the year he possessed art worth an estimated $330 million. He stashed it all in the Geneva Freeport and then set about covering up the evidence of how it had been financed. To do that, Low wrote a series of letters—supposedly from Eric Tan—offering him the artworks bought by Tanore as a gift.
In the letters, “Tan” said he was giving Low the art because of the “generosity, support and trust you have shared with me over the course of our friendship, especially during the difficult periods of my life.” All of the letters ended, absurdly, with a rider stating that the gift “should not in any event be construed as an act of corruption.” Low was exhibiting signs of sloppiness: It was risible that someone would hand over $100 million in art for no consideration. McFarland also got a painting from “Tan”—the cheaper Mark Ryden work—but no one could enjoy these testaments to human creativity; they were locked away in the humidity-controlled vaults of the Geneva Freeport.
Now, Low had hundreds of millions of dollars in a very safe place. But there was one asset even more transportable than art: jewelry. To keep Rosmah happy, and perhaps even attract a famous woman, in keeping with his newfound status, Low embarked on a jewelry-buying spree.
Chapter 32
Jewelers and Bankers
Aboard the M/S Topaz, French Riviera, July 2013
The mood among those aboard the Topaz, Sheikh Mansour’s superyacht, berthed just off the French Riviera, was celebratory. The boat had taken four years to build, at a cost of over $500 million—the value of five F-35 fighter jets—and it was an apt backdrop for Najib to celebrate his recent election victory. Sitting in a horseshoe of chairs, laid out in one of the yacht’s staterooms, the prime minister was talking business with Sheikh Mohammed, the crown prince of Abu Dhabi, who also was Sheikh Mansour’s brother.
Low helped arrange the meeting in early July 2013. The group also included Michael Evans, the Goldman vice president who met Najib at Davos, and Tim Leissner. As he held forth, Najib was in an ebullient mood. The money Low had put at his disposal had kept him securely in power. And now Abu Dhabi was preparing to pour money into a financial center that would carry the Razak family name, with Goldman standing by to help. Turning to Evans and Leissner, the prime minister heaped praise on the bankers for their role so far and promised it was just the tip of the iceberg.
“Do you see any other bankers on this boat?” Najib joked.
After the meeting, Najib and Rosmah hosted a private dinner in Saint-Tropez for around eighty people, with most of the attendees from Malaysia and the Middle East. As always, Jamie Foxx, by now a good friend of Low’s, was on hand to play the piano and sing.
One Goldman banker not there was David Ryan, the Asia president who had raised a series of questions about the 1MDB bond business, and had retired the same month aged only forty-three, abruptly ending a stellar career at the bank. He had been right to question the 1MDB business, but his warnings had gone unheeded.
The Topaz, the very boat on which the bankers stood, had been partly financed by the first set of bonds Goldman had sold, and now Low had spent 3.5 million euros to rent it for a week, drawing on 1MDB’s latest bonds. He had paid off his debt to Najib through his role in the elections, and the prime minister was content as Low continued to deliver a stream of Arab royalty to his doorstep. But he also had to think of Rosmah. He’d turned her son into a Hollywood producer and procured for her a dream mansion in London’s Belgravia, but there was one possession Rosmah craved above all others: diamonds.
That summer, while the Topaz was idling off the coast of France, Lorraine Schwartz, the famous U.S. jeweler, flew into Monaco, and Low whisked her to the yacht. He had bought jewelry from Schwartz over the years, getting to know her well—he told friends he was going to see “Lorraine”—but this order was of a different magnitude.
; Low had talked up Schwartz to Rosmah, impressing the first lady by the depth of his connections. Schwartz’s career had blossomed in the 2000s after Halle Berry wore one of her pieces on the red carpet, and her loyal customers ran the gamut of Hollywood stars. In June 2013, Low had texted the jeweler with a very specific request: He said he needed an eighteen-carat “pink heart diamond vivid or slightly short of vivid. On diamond necklace urgent.” By early July, Schwartz had found the perfect specimen. Low thought of sending Al Husseiny to pick it up for a viewing, but in the end Schwartz traveled out to France, without knowing the identity of the customer.
As Schwartz boarded the yacht, Low ushered her into a room, introducing the jeweler to the assembled group. It included Al Husseiny, Rosmah Mansor, and one of her Malaysian friends, and soon they were passing the shimmering diamond around between them, gasping over its beauty. In the diamond trade “vivid” is the top of a hierarchy of color intensity, and the diamond appeared to conceal a light shining from within. The group discussed different designs for the necklace to hold the diamond, which at twenty-two carats was even more exquisite than Low had requested. The group concurred: Making the chain out of interlinked smaller diamonds would be a perfect fit for Rosmah.
Two months later, in late September, Low’s Bombardier jet circled above New Jersey’s Teterboro Airport, a favorite landing spot for billionaires looking to get quickly to Manhattan. The plane touched down, and Low disembarked with Riza Aziz, Fat Eric, and Joey McFarland. They had been gambling and partying in Las Vegas, but Low had to get to New York for a meeting with Rosmah, whose husband was in town for the United Nations General Assembly. Najib loved rubbing shoulders with world leaders, and he rarely missed the chance to attend a summit, or give a speech about his “Global Movement of Moderates.” On this trip, the prime minister had pushed for a meeting with Lloyd Blankfein, Goldman’s chief executive. The bank was happy to oblige one of its top clients.
Rosmah was more concerned with jewels. A few weeks earlier, Low had fired off an email to Lorraine Schwartz, using the Eric Tan Gmail account, requesting she show the necklace to the first lady while she was in New York. He asked Schwartz to invoice Blackrock Commodities (Global), another shell company nominally owned by Tan, and made to look like Blackrock, the U.S. investment company. (Low also told people the company represented “Black”—for Rosmah’s heart—and “rock”—because she loved diamonds.) It was important, Low informed Schwartz, that all this was kept under wraps.
“Please as mentioned on many occasions, do not state Mr. Low’s name on email as he is just the introducer and not the buyer! V sensitive!” Low wrote to Schwartz’s assistant, using the Eric Tan Gmail.
After the elections, Najib wired back $620 million to Tanore, and some of that money ended up in an account held by Blackrock at DBS Bank of Singapore. Using the Tan email address, Low told DBS compliance that Blackrock was a wholesale buyer of jewelry, to justify tens of millions of dollars in inflows. Queries from DBS’s compliance department delayed the payment to Schwartz, but eventually Low, as usual, was able to urge bankers along, and the wire went through. The price was $27.3 million, making it one of the most expensive pieces of jewelry in the world.
The necklace wasn’t ready yet, but Rosmah was keen to see the designs. The couple had taken to staying in the Mandarin Oriental, on Columbus Circle, just off Central Park. Low’s Time Warner penthouse was basically part of the hotel—it was located above the guest rooms—allowing him to move easily to their suite without rousing media attention. On September 28, Low joined Rosmah and Schwartz in the room, where the jeweler showed her client various sketches of how it would look. They met with Rosmah’s approval. This was the largest of a series of diamonds that Low bought for Rosmah, but it was not the last.
While Rosmah concerned herself with jewelry, the prime minister was looking for more investments, and he turned again to Goldman. In a meeting room in the Mandarin Oriental he gave a pitch about Malaysia to a high-powered client meeting put together by Blankfein. Malaysia was so important for Goldman that Blankfein had roped in some of the biggest names in U.S. finance to attend. Still on a postelection high, Najib extolled Malaysia’s economy. The attendees included John Paulson, the hedge-fund owner who pocketed $4 billion trading credit-default swaps during the crisis; and David Bonderman, founder of TPG Capital, the private equity firm. Najib’s daughter, Nooryana, had joined TPG in London after Georgetown, and was now working for them in Hong Kong.
Leissner had been working hard to keep a lockdown on the Malaysia business, following Najib and Rosmah around the world. Goldman’s profits had awakened other Wall Street and European banks who now were attempting to get in on the action. As his prestige within Goldman grew and he became wealthier, Leissner’s lifestyle also changed. After dating a range of ordinary woman, the German banker now was with a star.
Back in March 2013, flush with triumph from Goldman’s latest bond, Leissner had boarded a Cathay Pacific flight from Hong Kong to Kuala Lumpur to attend the city’s Formula 1 race. The modern Sepang circuit, opened in the late 1990s near Putrajaya, was a symbol of Malaysia’s emergence as a modern country and had won the right to host a Grand Prix. Like Singapore’s race, the event was an excuse for the monied classes from around Southeast Asia to get together, make deals, and party.
On the plane, Leissner was seated in business class next to a glamorous woman a few years his junior, and he was struck by her appearance. The woman was six feet tall, with long black hair, pronounced cheekbones, and full lips. She seemed familiar. Soon after takeoff, the woman, Kimora Lee Simmons, a television personality and former U.S. fashion model, began to pile her bag and clothes into the spare middle seat that separated her from Leissner. Both passengers were frequent fliers, and Cathay Pacific had promised each of them use of the extra space. When Leissner complained to her, a heated disagreement ensued.
Simmons was well known in the United States for her reality-television show, Kimora: Life in the Fab Lane, which charted her efforts to build a fashion business while looking after her two daughters with former husband Russell Simmons, the founder of Def Jam Recordings. If the altercation started fiery, it turned smoldering, as Leissner and Simmons began to hit it off. They both were extreme extroverts who liked to talk. By the end of the four-hour flight, the Goldman banker proposed to her—the kind of grand gesture he liked to make to women.
They didn’t marry immediately. But Leissner started to bring Simmons with him on business trips, and she too got close to Najib and Rosmah. In Asia, face time is crucial to business success, and Leissner was shadowing Najib after the elections, from the south of France to the United States. Before New York, he had accompanied Najib and Rosmah on a visit to San Francisco for an event to open the office of Khazanah, Malaysia’s main sovereign wealth fund. It was nothing special—just a regular corporate public relations exercise—but was spiced up by the presence of Simmons.
Discretion was not her strong suit. With hundreds of thousands of followers on social media, Simmons lived in the public eye. In Malaysia, she posted on Instagram a picture from the Khazanah launch, showing her in a red off-the-shoulder dress, accompanied by Rosmah in a green-colored Malay-style top.
“In #SanFrancisco with my friend Datin Sri Rosmah,” she posted to her followers, using a Malay honorific.
It clearly wasn’t the first time they had hung out together. She posted another photo of herself with Leissner and Najib. The men were both in open-collared white shirts and jackets, and Leissner, his head now shaved and his face thinner, looked piercingly into the camera, while Najib smiled. It was a rare snapshot of the Goldman banker with the prime minister.
Leissner married Simmons at the end of 2013, around nine months after they met. Many at Goldman, whose executives like to stay out of the spotlight, even eschewing social media, were aghast as the German banker and Simmons’s romance began to land them in People magazine. The bank was hooked on the profits from Malaysia, but it did not need the attention.<
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Some bankers at Goldman, led by Leissner, were dependent on Low. The Malaysian’s desire to keep doing deals—building his empire—had them excited about the potential for even more business. Low’s company, Jynwel, had taken a minority stake in EMI Music Publishing, but now he wanted to lead a major acquisition, to become a genuinely famous investor. Better still, a sizzling business deal could generate profits to put his scheme on a solid footing.
Chapter 33
Bona Fide Business
New York, July 2013
The view from the restaurant where Jho Low and Steven Witkoff, a New York property developer, were holding a celebratory dinner gave out over Central Park South. The diners could see the famous Plaza Hotel, and nearby, the tired-looking Helmsley Park Lane Hotel, a forty-seven-story building from the early 1970s. The estate of Harry Helmsley, the legendary New York real estate baron, had been auctioning off properties since his death in 1997, followed by that of his wife a decade later, and the Park Lane was the crown jewel.
With sweeping vistas over Central Park, the hotel was a prime candidate for redevelopment. After a heated bidding war for the property, Witkoff and Low emerged victorious, with an offer in July 2013 to pay $654 million. The Malaysian had clinched the deal by agreeing to finance a $100 million down payment—more than double the usual amount for a transaction like this. As the pair tucked into dinner, they discussed plans to tear down the building, replacing it with a “billionaire tower,” the kind that were sprouting up across New York, a city awash in foreign money.