%1

In a U.S. court, former Goldman Sachs partner Tim Leissner has admitted to taking $60 million in kickbacks, lying to the bank about his corrupt deals, and twice forging divorce documents to take on new wives, Reuters reported. Despite his history of deceit, Leissner is the key witness prosecutors are asking jurors to believe in the trial of Roger Ng, a former colleague of Leissner's at Goldman who is charged with helping loot Malaysia's 1MDB sovereign wealth fund during a scheme that lasted from 2009 to 2014. Leissner in 2018 pleaded guilty to conspiring to launder money and violate an anti-bribery law, and agreed to cooperate with prosecutors. Ng pleaded not guilty to similar charges and is standing trial in Brooklyn federal court. In more than a week of testimony, Leissner has described his high-flying lifestyle as the lucrative 1MDB deals made him a "star," and the steps he took to avoid getting caught. The charges stem from some $6.5 billion in bonds Goldman helped 1MDB sell in 2012 and 2013. Prosecutors say $4.5 billion of that was embezzled by officials, bankers and their associates, in one of the biggest scandals in Wall Street history. Goldman in 2020 agreed to pay a $3 billion fine and have its Malaysia subsidiary plead guilty in U.S. court. The bank said at the time it did not adequately "scrutinize the representations of certain members of the deal team."

The U.S. Treasury Department is warning financial institutions and cryptocurrency firms to be on the lookout for attempts to evade sanctions and other restrictions imposed as a result of Russia’s ongoing invasion of Ukraine, the Wall Street Journal reported. The Financial Crimes Enforcement Network, an anti-money-laundering agency within the Treasury, issued an alert Monday that includes red flags to help financial institutions identify potential sanctions-evasion efforts and to remind them to quickly report any suspicious activities. The U.S. and its allies have imposed economic sanctions and trade restrictions on Russia and Belarus in recent weeks, including blacklisting key Russian state-owned banks and prohibiting transactions with some Russian government entities, including the Russian Central Bank. FinCEN said that sanctioned Russian and Belarusian entities and individuals may try to evade sanctions in various ways, including through non-sanctioned Russian and Belarusian banks and financial institutions in third countries. Some indicators of possible sanctions-evasion activity include the use of shell companies to obscure the ownership of entities or funds or to make international wire transfers.

The Russian government stands on the edge of defaulting on its sovereign debts for the first time since 1998, and international sanctions may complicate how creditors are compensated by nearly $6 billion of credit derivatives contracts if Russia fails to pay what they are owed, WSJ Pro Bankruptcy reported. Those derivative contracts, called credit default swaps, are meant to help investors insure they will receive near full compensation in case one of their underlying bonds defaults. There is approximately $4.5 billion of credit default swaps tied specifically to the Russian government, and an additional $1.5 billion located inside derivative indexes, according to JPMorgan Chase & Co. The cost of buying a five-year contract for protection against a Russian government default has skyrocketed since the beginning of February from around 5% of the total value of the debt to be insured to 46% as of March 4, according to data from ICE Data Services. ICE is the main clearinghouse for European credit default swaps.

A federal judge put in motion a sale process for Venezuela’s stake in Citgo Petroleum Corp. “up to and including selecting a winning bid,” even as the U.S. government continues to block any change in control of the Houston-based refiner, WSJ Pro Bankrupty reported. Judge Leonard Stark of the U.S. District Court in Wilmington, Del., approved a sale procedure for the shares of Citgo’s U.S. holding company, a valuable state asset controlled by the U.S.-backed opposition to Venezuela’s authoritarian regime. The shares can’t be transferred under current U.S. sanctions on Venezuela, blocking the country’s many unpaid creditors from seizing them for repayment. The judge nonetheless authorized a special master on Wednesday to conduct a marketing and sales process for the shares, while saying they can’t be transferred unless the recipient obtains permission from the Treasury Department. Judge Stark said he was authorizing a “contingent auction” that wouldn’t transfer the shares’ legal title until the winning bidder held a specific license from the Treasury Department’s Office of Foreign Assets Control.