Top Aussie regulator faces grilling over Goldman Sachs role

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PETALING JAYA: Australia’s top regulator James Shipton faces grilling in Parliament over his stint as head of regulation for Southeast Asia at Goldman Sachs, which is embroiled in controversy over state investment fund 1MDB.

According to the Guardian, Shipton, who leads the Australian Securities and Investments Commission (Asic), was Goldman Sach’s head of government and regulatory affairs in Asia Pacific from 2009 to 2013.

This was about the same time that Goldman was handling bond deals which raised US$6.5 billion for 1MDB.

The report said Peter Whish-Wilson, a senator from Australia’s Greens party, would question Shipton on his knowledge of the bond dealings.

“Rightly or wrongly, this issue may come to reflect on Mr Shipton, who now has the mammoth task of restoring trust in our corporate regulator, so it’s important to get this out in the open,” Whish-Wilson was quoted as saying.

“Mr Shipton should take the chance at estimates today to address any potential involvement in 1MDB, get this on public record, and answer questions about any potential reflections on or implications for his position.”

However, Asic senior executive leader for corporate affairs Matthew Abbott said Shipton’s role at Goldman Sachs only concerned “regulatory policy”.

“In this role, he was not involved in transactions, nor was he responsible for the firm’s regulatory compliance,” he told the Guardian.

Goldman Sachs made US$593 million working on three bond sales that raised US$6.5 billion for 1MDB in 2012 and 2013.

US officials maintain that more than US$2.7 billion in funds went to kickbacks and bribes.

The bank’s former Southeast Asia chairman, Tim Leissner, has pleaded guilty in the US and admitted to bribing officials to get bond deals, saying a culture of secrecy at Goldman Sachs led him to hide wrongdoing from compliance staff.

Former banker Roger Ng, meanwhile, agreed on Feb 15 to be extradited to the US to face three criminal charges relating to 1MDB.