The Man Behind the World's Biggest Financial Fraud | Investigators

At one point, Jho Low had more spending power than just about anyone on Earth because he had liquid cash in his account that was stolen. This fraud is unbelievable because Jho Low just stole billions of dollars almost overnight. Investigators have called it one of the biggest corruption cases ever. The center of one of the world’s biggest cases of white-collar crime. Billions of dollars vanished from the Malaysian state fund 1MDB, only to be spent on the political activities of a sitting prime minister and the lavish lifestyle of the scam’s mysterious mastermind, a Chinese businessman called Jho Low. He went on this kind of global spending spree. He would go and just drop millions of dollars in nightclubs and bars. As a lot of you in this room know, I like to plan my evenings and make sure that I always go to the best parties. Gambling and women. He had a private plane that he flew constantly around the world. Luxury yachts and homes in the Hamptons. The quantum of money that was stolen is so huge it makes previous frauds look almost pedestrian by comparison. I’m Bradley Hope, and I’m an investigative journalist and the co-author of Billion Dollar Whale. I’m Tom Wright, co-author of Billion Dollar Whale . So a few years ago, I was working for The Wall Street Journal in 2015. I came across a story about 1MDB, which was an incredible corruption scandal that already was out there in the media. And we really dug in, and we wrote a story, a front page story, about how Najib, the then prime minister of Malaysia, had used this fund as a slush fund for his political ambitions. I was relatively new at The Wall Street Journal, and they had assigned me to a pretty intense financial beat. And I was just reading the newspaper when I read Tom’s first story about the 1MDB scandal. And I noticed that there was a lot of references to Abu Dhabi, which is a place I used to live and report from. And so I got in touch with Tom and said, “Maybe I can help, and I have some contacts and things like that.” Bradley and I were able to piece together the way the fraud worked across different countries, and that was really key to the success of our endeavor. This is the Jho Low story in its potted version. Jho Low grew up in Penang, quite a small island in northern Malaysia, and he was from a sort of, you know, well-to-do family. So he went to all these fancy schools, like Harrow outside London and Wharton, and he was always kind of seemingly among the rich kids, but he wasn’t truly rich like some of these other guys that were there. And that was what made this whole thing possible is these close relationships he forged. The key to Jho Low’s fraud is that he’s able to network better than almost anyone else, any other fraudster in history. The fact that there are so many thinkers, connectors, and social entrepreneurs in one room truly motivates me. When Jho Low was studying in England at Harrow, he became friendly with a guy called Riza Aziz, who was Najib’s stepson. He got in with the family of Najib Razak, who eventually became the prime minister. And then, on the other hand, is his wife, who’s called Rosmah Mansor, and she was almost your picture-perfect wife of a kleptocratic kind of figure. She was addicted to spending, had just enormous amounts of jewelry in her house, even before they reached their peak of the 1MDB spending. She couldn't wear a lot of that stuff in public because it was actually too ostentatious. Jho Low understood that if he could get powerful people, prime ministers in different countries, leaders of different countries, to back what he was doing, then he could become extremely powerful. At his peak, Jho Low really wanted to have this image around himself as this major businessman who has this family kind of company, family fortune behind a company, and they created this video. The company was called Jynwel Capital. It’s just like a multimillion dollar kind of promo video that really just shows how he could use all of his connections to kind of bolster his image. It is about how each deal changes a community, a country, and the world. And he realized that there was so much money sloshing around in the world, especially state money, which is managed by sovereign wealth funds. So he persuaded Prime Minister Najib to set up a fund to ape what they were doing in the Middle East, and they called it 1MDB. And Najib knew that it was a slush fund, that he was using it to fund his political ambitions, but he didn’t know how much money Jho Low was taking out, and he gave Jho Low carte blanche to do what he wanted with the fund. At first, they borrowed from local banks in Malaysia, but they quickly hit a ceiling for how much they could borrow in that manner. And they also needed the imprimatur of a big, powerful Wall Street bank to make them look legitimate. And who better than Goldman Sachs, which is obviously the most powerful and well-known Wall Street bank in the world, right? So then they decided to graduate to the next level of borrowing, which was they issued a bond, globally, and Goldman Sachs sold that bond to investors. The way the scam worked was, they would pretend to do deals between 1MDB and a fund in the Middle East. And really, the money would just get stolen. So when he suddenly had all this money, that was stolen money from 1MDB, he went on this kind of global spending spree. He had a private plane that he flew constantly around the world. Then they went on a multi-year bacchanal of spending on gambling and women and luxury yachts and homes in the Hamptons and East and West Coast and all of that kind of stuff. He bought a big hotel in Beverly Hills. And then as soon as he kind of got the bug of being in Los Angeles, he wanted to become a filmmaker, a film financier. It happened that the son-in-law of the Prime Minister of Malaysia was also a big film buff. They got to know that Leonardo DiCaprio and Martin Scorsese wanted to make a film about the Wolf of Wall Street, Jordan Belfort, the famous scammer. But they couldn’t get any studio to give them the money because it was a huge budget, like $100 million. Jho Low stole money to make The Wolf of Wall Street film. And for Jho Low, this was a huge step into Hollywood, and he became a major figure. One of the best ways to kind of sum up Jho Low’s spending was he would have these ideas like, “I’m going to experience New Year’s twice.” He went to Sydney on a 747 with a planeful of celebrities, they experienced it, and then they went back to Las Vegas, and they did it all again. So the story really broke in 2015. That's when things really started to come out. Najib was ousted, and he even tried to leave the country with his wife, and they stopped him at the airport. He claimed he was just going to play golf in another country to relax after he lost the election. And they found all this money in his house, tens of millions of dollars of cash just in his house alongside endless amounts of jewelry, handbags, sunglasses, tiaras. And he was charged with multiple crimes. His wife was charged. Many members of the family and other people were charged. Najib denied it. He said that The Wall Street Journal , where I used to work, which broke this story, was, you know, that we were liars, that we were working for the Malaysian opposition, all these kinds of things that he said about us. He was convicted, and now he’s appealing. But in the meantime, he’s actually still part of the representative arm of the government. We don’t know exactly where Jho Low is right now, but a couple of years ago, after the book came out, we know for sure he was in China. We know he spent a lot of time between Macao, Hong Kong, and Shenzhen, the kind of a little triangle. And he’s spotted occasionally, like a year and a half ago, we heard he was at a Victoria’s Secret party in Shanghai. So he’s still hanging out in China. Over a period of three years, we traveled around the world. We went to Shanghai, Curacao, Thailand, chasing every lead, you know, reviewed thousands of financial statements and documents— many of them secret— investigative records in Malaysia, which there was hundreds of thousands of pages, and interviewed whistleblowers and every kind of former employee of 1MDB. One of the lessons from Billion Dollar Whale is that the checks and balances that are supposed to be in place to stop this kind of thing happening just didn’t work at all. If you’re moving huge amounts of money, raising and moving huge amounts of money, it seems to me in some cases it’s easier because for the banks involved there’s a reason to push it through because everyone’s going to make so much money.