NEW YORK (NYTIMES) – A flamboyant Malaysian financier who once hosted Hollywood parties and lavished gifts on models is on a new kind of charm offensive.
The financier, Low Taek Jho or Jho Low, is facing charges in a multibillion-dollar scandal that has rocked politics in Asia and shaken a premier Wall Street bank. And the legal team supporting him has spent more than US$1.1 million (S$1.5 million) over the past seven months to help improve his reputation, according to government filings.
These sophisticated services include round-the-clock crisis PR response, efforts to shape Internet search results, and a website with international reports and legal filings intended to bolster his side of the story.
The filings provide a glimpse inside a growing industry called litigation communications, which caters to wealthy people and corporations ensnared in international legal fights.
The filings themselves are something of a rarity – and a suggestion that such crisis managers are growing cautious as federal prosecutors cast a critical eye on foreign lobbying and influence campaigns.
The campaign on behalf of Low, carried out by two high-powered law firms, is described in filings submitted last month to the Justice Department under the Foreign Agents Registration Act (FARA).
Legal work done on behalf of foreign clients is exempted from the Act’s requirements, but increased scrutiny resulting from the investigation into Russian meddling in the 2016 presidential election helped prompt those representing Low to disclose their work under FARA.
The owner of one public relations firm hired by Low’s legal team, James Haggerty, said in one filing that he believed all of his work fell within the litigation exemption to FARA.
But Haggerty, who is also a lawyer, wrote that he registered anyway, “given the ambiguity in the law and differing interpretations”.
Haggerty and others have increased their efforts to burnish Low’s image as prosecutors have ramped up an investigation into the disappearance of more than US$2.7 billion from a Malaysian state investment fund called 1Malaysia Development Berhad (1MDB).
In court filings over the past two years, federal authorities have portrayed Low as the mastermind of a scheme to loot the fund, which was meant to finance business ventures and other projects to benefit the country’s 32 million people.
Instead, federal authorities have said, the missing money financed the lavish lifestyles of people close to the prime minister of Malaysia at the time.
Investigators said the money was used to buy luxury apartments in Manhattan, help finance the movie The Wolf Of Wall Street and buy a pink diamond necklace for the ousted Malaysian leader’s wife.
On Nov 1, federal prosecutors in Brooklyn announced the filing of an indictment charging Low, 36, with conspiracy to commit money laundering and to pay bribes to foreign officials. Prosecutors also charged two former Goldman Sachs bankers, one of whom has pleaded guilty.
Low’s location is unknown, but he has maintained his innocence – including on the website established on his behalf last month.
The site describes him as a “global philanthropist, investor, and entrepreneur,” who “believes he will be vindicated once all the relevant evidence has been presented in a fair and legitimate court of law”.
Putting up a website to declare one’s innocence and hiring public relations firms has become a common strategy by criminal defendants in recent years. But it is unusual for a legal team to disclose details of related payments.
The payments, made to three public relations firms and a digital search firm, were disclosed in FARA filings by the two law firms involved in Low’s defence, Kobre & Kim and Schillings International. The lawyers said the money did not come directly from Low, although they did not provide specifics about its source.
FARA requires most consultants who lobby or assist with public relations in the United States for foreign individuals, companies, governments and political parties to reveal detailed information about their work and payments for it.
It is intended to prevent foreign actors from surreptitiously influencing US politics and public policy, and has been employed as part of the investigation by the special counsel, Robert Mueller, as he examines Russian efforts to interfere in US politics and ties between President Donald Trump’s team and Russia.
Mueller’s team has charged several people with violating the Act, including Trump’s former campaign chairman, Paul Manafort, who was convicted on one set of charges and pleaded guilty to other charges related to his unregistered lobbying work on behalf of former Ukrainian President Viktor Yanukovych. The special counsel has also referred other cases related to the act to prosecutors in Washington and New York.
Kobre & Kim, in its filing, indicated that it had disbursed more than US$818,000 to four firms for work on Low’s behalf. The majority of that – roughly US$544,000 – went to Haggerty’s public relations firm, PRCG Haggerty.
Haggerty indicated in a FARA filing that his firm was providing “litigation communications” to Kobre & Kim “in order to ensure the client is not prejudged in public in a manner that affects his legal rights in jurisdictions across the globe”.
That included engaging “Australian partners” to provide outreach as needed to Asian and Australian news organisations covering the international scandal, he wrote.
Kobre & Kim has also paid two other public relations companies, the PHA Group in London, and in New York, Marathon Strategies, which was founded by long-time Democratic campaign operative Phil Singer after he helped run the communications team for Hillary Clinton’s 2008 presidential primary campaign.
A digital search and analytics firm called Five Blocks, based in New York, has so far been paid US$210,000 to provide “digital reputation management” for Low, one filing said.
On its site, Five Blocks describes itself as serving “high-profile individuals who want to build, promote, and defend their reputations.”
Schillings said in its filing that it had received US$349,000 as part of its work on the public relations effort for Low. The law firm said its decision to provide “FARA-registrable activities” was made “as a result of privileged and confidential e-mail and oral communications”.
Neither law firm disclosed how much it had earned from providing traditional legal services to Low since the investigation began roughly three years ago.
The act does not require the disclosure of payments for legal fees. But the FARA filings by Low’s team reveal the multiple hats that big law firms sometimes wear when they are representing prominent clients.
“Lawyers can and should do what they can on behalf of their clients including managing public relations,” said Rebecca Roiphe, a professor at New York Law School and a former prosecutor who specialises in legal ethics. “But lawyers do have certain ethical obligations that may not be the same as lobbyists” such as honesty about the identities and intentions of their clients.
Haggerty, who is serving as the main spokesman for the legal team, said there was nothing wrong with a person under investigation taking aggressive steps to clear his name.
“I reject the notion that only large, multinational banks and sovereign wealth funds are allowed a defence, either in court or in the public arena,” Haggerty said in an e-mailed statement.
Messages seeking comment from the law firms or the other companies they have hired were not returned.
Low was charged along with a former Goldman Sachs banker, Roger Ng, whom federal authorities are trying to extradite from Malaysia. Prosecutors also unsealed a guilty plea from another former Goldman banker, Tim Leissner, who was Ng’s supervisor and had forged a close relationship with Low over the past decade. The authorities said another top banker at Goldman was an uncharged co-conspirator in the scheme.
In pleading guilty, Leissner told a federal judge that his decision to hide his dealings with Low and the bribery scheme from Goldman’s compliance and legal department was “very much in line” with the culture at the firm.
Goldman helped 1MDB sell more than US$6 billion in bonds, generating over US$600 million in fees for the bank during a time it was still recovering from the financial crisis.
The bank has said it was cooperating with the investigation and acknowledged this month that it could pay “significant fines” in any settlement related to the fund.
Malaysia’s finance minister said on Monday (Nov 12) that the country was seeking a full refund of what it paid the bank – a statement that helped send Goldman shares down 7.5 per cent on Monday.
A lawyer for Leissner declined to comment. A lawyer in Malaysia for Ng did not respond to a request for comment.
The FARA filings list Low as living in Malaysia. But he has not been seen in that country for many months and is believed to be living in China, according to three people with knowledge of the investigation but not authorised to speak publicly. Earlier this year, Malaysian authorities charged him with multiple counts of money laundering.
The most recent statement posted on Low’s site, dated Nov 1, says, “Mr Low simply asks that the public keep an open mind regarding this case until all of the evidence comes to light, which he believes will vindicate him.”
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