349: Tom Wright on the Billion Dollar Whale

Tom Wright is a co-author of the best selling book Billion Dollar Whale: The Man Who Fooled Wall Street, Hollywood, and the World. He is a Hong Kong-based journalist who previously spent years with The Wall Street Journal. In 2011, he was also one of the first journalists to arrive at the scene of the raid in which Navy SEALs killed Osama bin Laden. In this conversation, we discuss the best selling book, the process required to confirm so many details and facts, who tried to stop him and how, what the craziest stories he uncovered were, where he thinks Jho Low is, and how he anticipates large frauds to continue to happen around the world. =============================== The Helium Hotspot is a new product that enables the people, not the telcos, to own and operate a wireless network in their city for Internet of Things devices. You can literally earn crypto for helping to build the network and providing connectivity to Internet of Things devices sending small bits of data. Join the movement and get your Helium Hotspot today with $50 off using the code POMP at helium.com. =============================== The World Series of Trading (WSOT) is the first of its kind to bring the exhilaration of crypto trading competition to the global stage. WSOT believes in the importance of empowering traders who embody the passion and power for crypto trading. This bi-annual event aims to champion the spirit of competition, fair play, and cultivate camaraderie among crypto derivatives traders from around the world with the ultimate goal of creating positive change in the crypto space. This year’s prize pool is a whopping 200 BTC. Sign up here: http://www.bybit.com/wsot_warmup? =============================== Pomp writes a daily letter to over 50,000 investors about business, technology, and finance. He breaks down complex topics into easy to understand language, while sharing opinions on various aspects of each industry. You can subscribe at https://www.pompletter.com

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off.

• 0:11Anthony Pompliano?

  Tom Wright is a co-author of the bestselling book Billion Dollar Whale, The Man Who Fooled Wall Street, Hollywood, and the World. He is a Hong Kong-based journalist who previously spent years with the Wall Street Journal. In 2011, he was also one of the first journalists to arrive at the scene of the raid in which Navy SEALs killed Osama bin Laden. In this conversation, we discuss the bestselling book, the process required to confirm so many details and facts, who tried to stop him and how, what the craziest stories he uncovered were, how and where he thinks Joe Lo is, and how he anticipates large frauds to continue to happen around the world. I really enjoyed this conversation with Tom, and I hope you do as well. Before we get into this episode, though, I want to quickly talk about our

• 0:55Anthony Pompliano?

  sponsors. The first is Helium. The Helium Hotspot is a new product that enables the people, not the telcos, to own and operate a wireless network in their city for Internet of Things devices. That's right, the telcos historically have had a monopoly on wireless networks, but now we're decentralizing that ownership and allowing for the everyday person to own and operate a wireless network in their city. You can literally earn crypto for helping to build the network and providing connectivity to Internet of Things devices. You can join the movement and get your Helium Hotspot today with $50 off using the code POMP, P-O-M-P, at helium.com. I've got one set up. It's super easy. It took me literally three minutes to get it up and running, and I love the idea of democratizing access,

• 1:40Anthony Pompliano?

  ownership, and operations from the telcos and giving the people the power of a wireless network. Helium.com, use code POMP, get 50 bucks off. Go get a Helium Hotspot today. Our next sponsor is the World Series of Trading. It's the first of its kind to bring the exhilaration of crypto trading competition to the global stage. World Series of Trading believes in the importance of empowering traders who embody the passion and power for crypto trading. This biannual event aims to champion the spirit of competition, fair play, and cultivate camaraderie among top crypto derivative traders from around the world with the ultimate goal of creating positive change in the crypto space. This year's prize pool is a whopping 200 Bitcoin. That's right, 200 Bitcoin up for grabs for

• 2:23Anthony Pompliano?

  the top crypto derivatives trader around the world. You can go in the description of this podcast, click the link and sign up there. Lastly, I write a daily letter to over 50,000 investors about business, technology, and finance. I break down complex topics into easy to understand language while sharing my personal opinion on various aspects of each industry. You can subscribe at pompletter.com. Again, pompletter.com. All right, let's get in this episode with Tom. I hope you guys enjoy it.

• 2:50Speaker 00

  Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 3:17Anthony Pompliano?

  All right, guys. Bang, bang. Super excited. Tom is here. What's going on, man? Thank you so much for doing this.

• 3:23Speaker 02

  Yeah, it's great. Good to be on here.

• 3:25Anthony Pompliano?

  Absolutely. All right. So everyone obviously knows that you are an author of Billy Dollar Whale. Let's talk a little bit about your background before you wrote the book. Where'd you grow up and what did you do before you wrote that book?

• 3:38Speaker 02

  Well, I grew up in the UK, but I came to Asia as a young guy, basically after high school for a year to Indonesia. Then I studied in the UK, got my college degree, and then I came straight back out to Asia. I've been here for 25 years almost now. So made my career out here in Southeast Asia, in India, India and Pakistan, did Pakistan for a while. And now I'm based in Hong Kong. So yeah, I've sort of cut my ties with the old country.

• 4:09Anthony Pompliano?

  And what was the original allure to go to Asia in general? What brought you there and then why stay?

• 4:16Speaker 02

  I think as a kid, I'd read Marco Polo and I'd seen the film The Killing Fields, which I don't know if you guys know, it's a big film in America, but it's about Cambodia. And so I had this sort of dream to be a journalist from very, very young because of those kind of things, you know, Apocalypse Now, films like that. By the time I got here, which was the mid 90s, it was more like the end, it was a big massive economic boom. And so it was very attractive as well because it was the fastest growing place in the world, Southeast Asia at that time, which very few people remember now. Countries like Indonesia were booming. And so I was attracted to that fast changing lifestyle that was happening at that time in those places. And then the Asian crash happened in the late 90s, huge economic

• 5:00Speaker 02

  crash. And that's when I moved out here permanently around that time.

• 5:04Anthony Pompliano?

  Got it. And so do you remember the first time that you kind of heard of OneMDB or Joe Low? And kind of like, what was the first interaction you had with this story?

• 5:14Speaker 02

  So yeah, so obviously there's a big gap between moving out here in the 90s and then OneMDB. OneMDB, that story sort of started around, well, the fraud started around 2009.

• 5:26Speaker 02

  But they kept it under cover for many years. So this was, just to quickly recap for your listeners, this was an amazing fraud where a young 28 year old at the time, a guy called Joe Low, persuades the Malaysian Prime Minister to let him set up a fund. And they borrowed billions of dollars with the help of Goldman Sachs. And then they steal, they just steal all the money. And they steal, we think between six and seven billion dollars, something like that. So the story first came out in 2015, when a woman called Claire Rukasal Brown at the Sarawak Report, which is like a muckraking website focused on Malaysia, and a newspaper in Malaysia called The Edge, got hold of an email server from a disgruntled

• 6:10Speaker 02

  employee who'd been involved with one of the companies that was involved in the fraud, which we can get into later about how all this happened. And those email servers sort of laid out some of the ways in which Joe Low had stolen some of his early money. And that was really the first time that people were, realized what a huge fraud was going on here. But it was only like a very, those emails only painted a tiny, shone a tiny light onto a tiny part of this fraud, which then took years to investigate.

• 6:41Anthony Pompliano?

  Got it. And I think the interesting part when I read the book was this wasn't like a stranger met the Prime Minister of Malaysia. And next thing you know, there's billions of dollars flowing in his pocket, right? There was kind of some some ties, mutual friends. Maybe talk a little bit about the relationship that Joe Lo, who is a Wharton grad, but still relatively young in his twenties. How does he end up building the rapport with, you know, what is one of the world leaders? And kind of setting all of this up?

• 7:08Speaker 02

  Well, Jolo was kind of lucky. So he went to Wharton in the US. He went to he went to Eaton in the UK, or Harrow, sorry, I should say. And what he was able to do was meet the kids. He was from a fairly well to do family himself, Malaysian business family, Chinese Malaysians. And he was able to meet all these extremely powerful, the kids of extremely powerful families, including the kid of the child of Najib Razak, who would become Malaysia's Prime Minister. What Jolo does, he goes to Wharton, he does, he gets an economics degree or a business degree. Instead of going and getting a job at Wall Street, or, you know, a standard consulting job, he just tries to broker deals between the Middle Easterners that he's met, the families of rich Middle Easterners,

• 7:53Speaker 02

  and then Najib Razak back in Malaysia, like bringing Middle Eastern money into Malaysia. And he's a brilliant networker. And back then, this is like 2005, 2006, he's able to bring in, you know, hundreds of millions of dollars of Middle Eastern money to get involved in infrastructure projects in Malaysia. So when Najib Razak becomes the Prime Minister in 2009, 2008, 2009, Jolo is his sort of right hand man. And he's only this 28 year old guy with no, who's never really held down a proper job. And he persuades the Prime Minister to set up this fund called One M D B. And this is after the great financial crisis in the US and in Europe. There's a lot of money looking to invest in Asia at that time. And they set up this fund,

• 8:38Speaker 02

  they raise billions of dollars. And it's the fund is supposed to improve the lives of Malaysians by, you know, creating jobs. But what it really does is, well, it doesn't actually do anything, really. I mean, they just steal the money and use it. And we should go on to talk about what they use it to do, which is, which is really incredible.

• 8:57Anthony Pompliano?

  For sure. And to me, the part that I think is interesting here is Joe Low kind of understands what I'd call the basics of how to commit this fraud, right? The whole idea of like, how do I set up a shell company in the Caribbean to look very, very similar to a Middle Eastern fund's name, but obviously it's not. And so he kind of socially engineers to some degree, whether intentionally or just by accident, a lot of trust in the system and billions and billions of dollars, as you mentioned, kind of flow to him. Any kind of idea in terms of like, was that something where people were literally just ignorant and kind of, you know, almost just being dumb and overlooking it? Or was there some intentionality there where people kind

• 9:40Anthony Pompliano?

  of knew what was going on, but they didn't care because they were benefiting in some way and the money was still flowing?

• 9:46Speaker 02

  That's a great question. So for example, he steals, I mentioned Goldman Sachs helped the fund raise this, these billions of dollars worth of bonds. So this isn't money that the fund had, they went out and raised it. Then they're supposed to send that money, some of that money to a partner in the Middle East called IPEC, which is another big investment fund in the UAE, the United Arab Emirates. But what they do, as you just mentioned, is they set up a lookalike company that looks like IPEC, but it's in the, in the BVI, it's a British Virgin Islands shell company. Now, of course, you couldn't do that without the connivance of the person who was really running IPEC, which was a guy called Karim Al Khabasi. So it's insanely corrupt. You've got, on the Malaysian side, you've got the prime minister who's involved in this, right? So you have the cover on the Malaysian side, Jolo's running

• 10:31Speaker 02

  it, running this fund. And on the other side, on the Arab, on the Arab side, you have Karim Al Khabasi, who's running a multi-billion dollar fund, huge fund. It had invested in, you know, Richard Branson's Virgin Galactic and those kind of things, a proper company. And, and everyone knows it's going to the fake IPEC, not the real IPEC. But, but the share, I guess the boards of those companies don't know. And then the other question is, how, how was, how were all these billions of dollars able to flow when international banks that did the transactions were supposed to catch it too? Because of course, if you do Dollar transaction, the US banks are supposed to catch it, right? Correspondence banks like Wells Fargo, which who were involved or Goldman itself.

• 11:15Speaker 02

  And what billion dollar well shows is that every step of the way, they did not, nobody caught this stuff. And your question, was it willful? Was it, you know, everyone was making a lot of money. And so maybe sometimes it was people have the wool pulled over their eyes, but at others, it was willful ignorance to make cash and make bonuses.

• 11:34Anthony Pompliano?

  Yeah. And the part to me, if I understand correctly, is the billions of dollars are raised by Goldman for the bonds. They made about six hundred million dollars in fees, which is a comparably kind of pretty outrageous fee structure. And so it was almost like, hey, we're making so much money on this, maybe we won't ask as many questions. Was that your take on the situation as well?

• 11:53Speaker 02

  Yes, a hundred percent. I mean, so what happened was that the fund went, Jolo went to a guy called Tim Leisner, who was a partner of Goldman in Asia, who's now pleaded guilty to helping steal two hundred million dollars. The sentencing is still to come.

• 12:07Speaker 02

  And they said, look, we need to, we need to raise all this money. Now, did everyone at Goldman know that the money was going to be stolen? No, I don't think that is, that is the case. But there were huge red flags that at every stage of the way were missed. So Goldman is saying this guy, Tim Leisner, the former partner, was a rogue banker. Okay, that's their defense, but I think it's not as simple as that. I think a lot of people at Goldman knew that there were problems here. For example, the fund in Malaysia asked, they raised three billion dollar bond, and they asked for it to be put into a Swiss bank account that the fund had. Now, why would a sovereign fund in Malaysia have a Swiss bank account? And Goldman's lawyers, link later, has actually raised questions about this in real time. Wasn't as if this is all hindsight.

• 12:49Speaker 02

  And they just said, well, you know, this bank's not on any money laundering or terrorism blacklist, so let's just do it. And everyone was making huge, huge bonuses. And so that was the problem. You know, compliance were telling, Goldman's compliance was saying, do not deal with this guy Jolo. They turned him down for a private bank account. It was pretty obvious because you couldn't, this guy had billions of dollars, but if you did a Google search, you couldn't, and he was claiming it's family money. But if you did a Google search, you couldn't find any mention of him, right? And so the fact that all these transactions went through is just astounding.

• 13:23Anthony Pompliano?

  Yeah. And so when you say that they raised these bonds, where did that money come from? Is this institutions buying into the bonds? Is this retail investors? Where are the billions of dollars kind of originally flowing from?

• 13:34Speaker 02

  Yeah, I mean, like I said earlier, this is post financial crisis. There's a lot, there's obviously low interest rates, negative interest rates, lot of liquidity, and not that many investments to make in the US and your stock market was down. I mean, Lloyd Blankfein, who was then CEO of Goldman, is telling people, you know, "Go out to Asia. Let's be Goldman in more places," was the quote he said at that time, which meant go and find places to invest and deals to do that aren't in Europe and the US, you know, before they recovered. And so that's why investors were so willing to snap up these bonds. And they were very, they were very popular. And of course, they also yielded extremely high, high numbers because of the way that Goldman and the one MBB structured it.

• 14:19Anthony Pompliano?

  Yeah. And so the funniest part to me is the way that you guys write the book, it seems like it's pretty obvious, and I'm sure there's some hindsight bias of like, "Hey, here's all the red flags." But, you know, it would have taken somebody to be intelligent and thoughtful and thorough to put that together in real time. But it sounds like kind of at each step of the way, somebody was raising red flags. When you zoom out and you look at billions and billions of dollars, the part that sticks out is just the arrogance of Joe Lo and kind of the other people involved as to what they did with the money, right? And so maybe talk a little bit about like, as you guys are going to write the book, like, how do you track down all the assets and kind of, you know, are you just kind of mind blown every time you find more and more ridiculous things that they use the money for?

• 15:02Speaker 02

  Yeah, well, the big thing, the famous thing that they used the money for was to buy a film company called Red Granite Pictures, or to set up a film company called Red Granite Pictures, which went on to make The Wolf of Wall Street with Leonardo DiCaprio, and they made Daddy's Home, and Dumb and Dumber 2, and a bunch of other films. So you're talking a little bit about how did we uncover all of this? Well, we actually got hold of the email server of Red Granite Pictures, and in there were all the cellphone numbers of all the Hollywood stars. And we also then noticed that there were lots of Playboy Playmates in there, that sort of... Scores of them. And so we just set to doing sort of traditional reporting, which is just calling the numbers and asking to speak to people. So we spoke to, we called like all the Playboy Playmates. These were the ones who were were in the magazine in two thousand nine, two thousand ten.

• 15:45Speaker 02

  And we we finally got one, a woman called Stephanie Larrimore, who said, oh, yes, I remember Joe Low and um. Yeah, we partied with him and Leonardo DiCaprio in the Palazzo in Vegas in two thousand and nine. And she told this strange story of like there being twenty plus Playmates, DiCaprio, Jolo and and almost no one else. And playing baccarat and partying and dancing. And so that's the chapter in the book called um An Evening with the Playmates. And that was Jolo's M O, right? He'd stolen all his money. He was probably one of the most liquid cash. Guys in the world because he didn't have a real business. He just had the money. And he wanted to go and make songs. And so he was courting DiCaprio, telling him, we we'll give you.

• 16:27Speaker 02

  You know, hundreds of millions of dollars to make your next four films with Scorsese. They were going to make The Irishman before all this this blew up. Um, and that was, that was how he operated and he would spend money like nobody's business, right? I mean, you you. That's the most amazing thing to me.

• 16:44Anthony Pompliano?

  I I remember the one story where I think it was his birthday party, or maybe he was throwing the birthday party for somebody in an airport hangar.

• 16:51Speaker 02

  Uh, it's, yeah, it was actually a, it's a prologue of the book. So for his his thirty first birthday, he hired a vacant lock lot off the strip. Turned it into sort of like an airport hangar. Um, and it was, it was like the Oscars. I mean, the the. The caliber of actors who were there. And I mean, people had heard about this guy and and they didn't really know. I mean, DiCaprio was given lots of gifts from Jolo Picasso paintings and that kind of thing, but there's no idea that these guys knew that he was he was fraud. Um, and they gave back these gifts in the end. But I think if you're in Hollywood, you're used to people with a lot of money. Uh, coming by and financing your film and you don't necessarily question uh where they come from, right? And there were all these rumors about Jolo at the time. Is he an arms dealer? Is he a friend of the prime minister?

• 17:35Speaker 02

  But I think it was, there was a sort of Orientalism here. You're able to say, okay, this guy's just out in Asia. Yeah, there's a lot of money in Asia. We don't need to prove much. More deeply than that, but it's a massive embarrassment to all the people who uh yeah, everyone, I mean, Jamie Foxx would emcee for him and take, you know, do a lunchtime speech and take millions um. Swizz Beatz, Alicia Keys' husband was hanging with him all the time and getting paid, you know, right up to the very end and even after it was exposed. So it's it's just an amazing network of this guy.

• 18:03Anthony Pompliano?

  Yeah, a- and I guess like, what do those people think about it now, right? I I mean, you mentioned some pretty big, well-known people. Is it something where they actually are a little embarrassed and maybe like, ah, you know, I got duped a little bit? Or was it something where they kind of throw their hands up, say, look, we had no clue, we never asked and uh, you know, frankly, I don't care, I just had a good time and, you know, move on with my life?

• 18:23Speaker 02

  Well, you have to say you got duped, because if you didn't get duped, you were you were complicit, right? So, I mean, everyone says they got duped or they just didn't realize. I mean, there's a there's another scene in Billion Dollar Whale where Jordan Belfort, who of course is the real Wolf of Wall Street, is on set, he's not on set, so he's at this launch party in the Cannes Film Festival that they put on to say, look, with his new film company and we're gonna make the Wolf of Wall Street. And he's in the crowd and he says, you know, turns to his girlfriend and he goes, this is a fucking scam. Nobody would spend their own money like this. And what he means is like they spent, they've spent millions on this launch party and they're not even, they haven't even made a film yet. So there were real people, there were people who in real time uh saw it as a fraud, right? But, you know, DiCaprio says that he was, he just didn't know and that, um, you know, when he found out, he gave the money back.

• 19:07Speaker 02

  And of course, Jolo went on to date Miranda Kerr, the Australian supermodel, um, and, you know, gave her jewelry worth eight million dollars. Um, she also, she she she was with him for about a year and she also says, look, I didn't know the true story about this guy. I think people just, you know, they saw her money bags and they didn't bother to ask any questions. That's all I can, all I can say about it.

• 19:30Anthony Pompliano?

  Yeah, um, I looked before before we did this at some of the assets uh that were reported as, um, you know, so the the new information that came out. And uh, I was shocked. So you get multi-million dollar properties in, you know, L A, New York, London, elsewhere. You've got about a two hundred and fifty million dollar yacht, you've got a thirty five million dollar private jet, you've got obviously the uh see-through piano in Miranda Kerr's house that like can't get out of the house. Um, I mean, i- it was like, you know, you're kind of reading through this list and you're like, what would you do if you never had money before? And now all of a sudden you're given billions of dollars and you could go like, spend it on whatever you want. Like, this was literally like the Christmas list, right?

• 20:10Speaker 02

  Yeah, the Miranda Curse perspex piano that they cannot get out of a Malibu home because they built walls around it. I love that story. So what we should say is in 2016, the Department of Justice in the US moved to seize all these assets, right? So what happens in the if you the you obviously fraudsters from around the world like to spend their money in the US because you can get bang for your buck. You can buy a hundred million dollar apartment on Central Park and that kind of thing. And they like living there as well. And so Jolo bought, for example, an apartment in the Time Warner Center in Columbus Circle, which had been Jay-Z and Beyonce's apartment.

• 20:45Speaker 02

  He bought he bought a mansion on the Bird Streets in Los Angeles, which is close to where DiCaprio lives. They actually set up their offices on the same building as DiCaprio's production company on the on the Sunset Strip. So, yeah, he they really moved into the US in assets in a big way because that was a way to first of all, he wanted to be a big player in the US, not just in Hollywood, but also he was looking to buy Reebok from Adidas. He was looking to buy Tom Ford, the maker of James Bond suits. And he bought the Central he bought the Park Lane Hotel, the big hotel on Central Park South. So he was he was setting himself he became a he became the Asia president of EMI Music Publishing, and he was involved in that investment, too. So he was he was really trying to become a real investor

• 21:29Speaker 02

  and a real billionaire, you know, even though the whole thing was a sham.

• 21:32Anthony Pompliano?

  It's almost like if I can steal some money to get started, then I can go and try to become legitimate at some, you know, former fashion, which is pretty crazy. Obviously, the reason why I wanted to talk is Goldman just announced that there's a new settlement. And so maybe give us a little backstory in terms of kind of what's happened with the Goldman bankers. I think that's kind of a unique situation, some of the prior offers, and then where ultimately this settlement is is kind of netting out.

• 21:59Speaker 02

  Yeah. So when this whole thing came crashing down, as I said, these stories started coming out in 2015. And then, you know, we spent between 2015 and 2018, writing many different stories and writing the book. Goldman, at the time, was saying, look, I mean, we just did a very beginning, they said, we were just the banker. We just did a normal job raising money. We had no idea whether whether, excuse me, I need to drink.

• 22:22Speaker 02

  Got a bit of a sniffle, not copied, don't worry.

• 22:28Speaker 02

  They said, look, we could not possibly have known where this was fraud, we just raised the money. Okay, but then it transpired that the main banker on the deal, Tim Leisner, a German national who was a partner and a very senior guy, who was actually ended up becoming chairman of Southeast Asia for Goldman, he was in on the fraud and he has admitted that to American investigators now, helped to set up funds to move 200 million dollars around, including to, they even discussed buying jewellery for the wife of Najib Razak, the prime minister, who was this, who when she was arrested in Malaysia, had 250 million dollars of loose items in her apartments, you know, jewellery and bags, Birkin bags and all that kind of thing. And so it became more and more difficult for Goldman to say nothing had happened.

• 23:12Speaker 02

  And then they said, well, look, this was a rogue banker.

• 23:16Speaker 02

  This guy and another guy called Raj Ang, who's also been arrested, who's a Malaysian banker at Goldman. So they said, look, Lloyd Blankfein wasn't involved, Gary Cohen, who was the number two at Goldman at the time, who went on to be Trump's economic adviser, these guys weren't involved. But then Malaysia, in late 2018, they actually filed criminal charges against a number of Goldman bankers, senior executives. So what happened just the last few days is Goldman has had to settle with them, with Malaysia, to get those charges dropped. And it's agreed to pay 2.5 billion dollars to Malaysia.

• 23:53Speaker 02

  Now, this is not including the settlement they're going to have to do with the DOJ, the Department of Justice in the US. It doesn't include any criminal, this is just a civil case, it doesn't include any criminal matters in the US. And that is five times the amount that Goldman paid in fines after the global financial crisis. They paid 500 million for the whole subprime, you remember Abacus, all of that stuff, only 500, only 500 million, but like a fifth. And this is only just starting. So I don't think people quite realise how, I mean, the book's done well, right? We saw quite a few copies of it and people like yourself know the story, but I think if you want to realise the size of this fraud and the implications of it. And when I think, you know, we're hearing, it could be as early as as next week that Goldman settle in the US.

• 24:37Speaker 02

  And that's, there's going to be even sort of higher, higher fines. And so this is all, this is all still to play out. We don't know what the, and then the big question is, will Goldman have to plead guilty? Which of course, that never really happened after the global financial crisis. There are all these deferred prosecution agreements where you, you, you paid a fine, but you didn't plead guilty. So that's all to play out.

• 24:56Anthony Pompliano?

  Yeah. And so the $2.5 billion settlement is in cash. And then the number that everyone keeps seeing is 3.9 billion. And obviously that 1.4 billion dollar difference isn't in cash. Describe a little bit, kind of this whole idea of like guaranteeing assets. And why is the media reporting a $3.9 billion settlement with Malaysia? There are only 2.5 billions in cash.

• 25:18Speaker 02

  Well, the Malaysian government was under a huge pressure to come up with a huge number because they've, they've got to show that they're. And what, what Goldman is doing is paying 2.5 in cash. And then it's, then there's 1.4 billion of assets, these assets that the US has seized, which includes, you know, Jolo's apartment in, in Columbus Circle and the Time Warner Building, those kind of things. The, the, the initial lawsuits in the US were US versus Wolf of Wall Street. He actually seized the film, the, the profits from the film. So what Goldman's saying is we will guarantee that you get back from the US government 1.4 billion. It's been described as a sort of a put, like almost a put, right? But I don't think Goldman would have done that if it, if it hadn't looked at the assets and worked out what they're worth

• 26:02Speaker 02

  and realized that it's not, not a huge risk, right? Goldman doesn't do that kind of thing without getting its analysts to really look closely. So that's not really a, I don't really see that as a cost to Goldman. I mean, I could be wrong. Maybe the assets will come in at only 700, you know, you know, or 70% of what that 1.4 billion, right? But I just think it's unlikely. I mean, it's just that, it's just a sort of a financial engineering thing, I think.

• 26:27Anthony Pompliano?

  Yeah, and so in exchange for this kind of $2.5 billion in cash and then the guarantee on the asset, it sounds like Malaysia has agreed to basically drop all charges criminally against Goldman as an organization and pretty much everyone except for the two quote-unquote rogue bankers, or is that incorrect?

• 26:48Speaker 02

  No, that's totally correct. So then these two rogue bankers, well, I'm not calling them rogue bankers because I actually think there were more people that knew about it that were at least turning a blind eye. But yeah, these two bankers, Tim Leisner and Roger Ang, they have got criminal cases ongoing against them in the US. And as I said, Roger Ang has pleaded not guilty, but Tim Leisner has pleaded guilty and he's been cooperating. And so his sentencing should, I mean, it's been postponed a number of times since last summer, but everyone's waiting to see what happens there because I don't, I mean, I can't imagine his cooperation was that useful because it's not as if they rounded up and charged on to other Goldman bankers, right? So Goldman's argument that this was rogue is, I guess,

• 27:33Speaker 02

  partly true, but the point is, there were a lot of other people that knew there were red flags because, you know, in the emails that we've seen, for example, they will talk about, oh, we must keep Jolo out of this, you know, we'll do business with him, but we can't be seen to be doing business with him. So I think the knowledge of the shadiness of this practice went much deeper at Goldman than just those two bankers.

• 27:52Anthony Pompliano?

  Yeah, and my understanding from kind of reading some of the news reports after I read the book was, I think it's Tim Leisner has given back like $40 million and kind of there's a bunch of money that's moving around. And frankly, when you're talking about billions of dollars in a fraud, any number smaller than a billion kind of seems small, right? But for an individual to kind of turn over $40 million, one, like that's what supposedly or he's allegedly earned from doing these deals. So as a personal income, like pretty big number, and then to actually turn around and give it back as part of these, you know, pleading guilty, whatever. What is interesting, though, you mentioned the $500 million that Goldman paid during the global financial crisis, and now you've got $2.5 billion here, but the global financial crisis also, I don't, it would definitely

• 28:37Anthony Pompliano?

  Nobody at Goldman that I know of was arrested. I don't think kind of anyone really across Wall Street was really arrested on the criminal side. And so kind of how do you see that playing out in the US? So you've got two guys who pleaded, uh, one guy's pled guilty, one who's pled not guilty. But this feels very different and feels like actually there are going to be some people who who get in trouble.

• 28:58Speaker 02

  Well, I think this is, I mean, I'm guessing or I'm hoping at least this is when it really is going to get into the, it's going to go wider in the US. And more people will be aware of it as a story, not just, you know, financial types of people like reading business books or, you know, I mean, the Hollywood angles already. Let it jump over a little bit to that that audience, but um, and I think when a Goldman banker or partner is sentenced to jail. If if that happens, which I can't see, like, I mean, I would be surprised if there was any other outcome. That's gonna, that's gonna generate a lot of headlines because, like you said, after the financial crisis, nobody did what I think there was one banker from Credit Suisse who went to jail. And I think that was it. Um, really wasn't, there really wasn't very much. You remember Fabulous Fab, uh, who was the Goldman banker?

• 29:40Speaker 02

  Who was, who talked about selling products to widows and orphans and all of that, but there, but there wasn't really very much criminal sanction. Um, after the global financial crisis, as we, as we just said, there, there were a lot of deferred prosecution agreements where you pay a fine and you, you don't admit guilt. Um, so the big thing that Goldman, Goldman's lawyers now, um, Kirkland and Ellis, um, which is a bill by Attorney General Bill Basel. Are um, uh, negotiating very, very hard with the Department of Justice to not plead guilty. Um, the Wall Street Journal had a story earlier this year that they, that they had agreed in, in principle to plead guilty at the Singapore unit level. Which is, which is fits their rogue narrative, uh, narrative, their rogue banker narrative, right? Which is it all happened under Tim Leisner in the Singapore office.

• 30:26Speaker 02

  Whereas I think a lot of people at DOJ want to have Goldman plead guilty at the firm level. So that's, that's another really important thing to watch.

• 30:34Anthony Pompliano?

  What is the difference there, right? Obviously, it's kind of the whole company versus a, a single office. But kind of what are the ramifications of the guilty plea came in at the firm level versus a single office?

• 30:45Speaker 02

  Well, Lord Blankfein was the chief executive during all of this. He was the chief executive during the subprime meltdown. He was the chief executive during the whole Libyan debacle, which you might know about. And then he was the chief executive for this. He left in the fall of 2018. And so the question is, did he retire? Was he pushed out? His options have actually been suspended. Some of his pay has been suspended, pending the end of this investigation. So it's a huge question whether it's firm-wide or whether it's only at the Singapore unit. Because if it's firm-wide, then the very top dogs of the bank have to admit their role in it, or that they failed in their oversight. Lord Blankfein met Jolo, at least on two occasions,

• 31:29Speaker 02

  I believe, in New York, in Goldman's headquarters, on one occasion. You don't get to see Lord Blankfein unless you're vetted. And I think he met him with Najib at one point. Now Goldman would say, look, he was seen as an emissary of Najib. Najib was the prime minister. How could we have known? But don't forget, at that time Goldman's compliance department was saying, don't open a private bank account for this Jolo guy, right? Goldman are very smart. They knew who Jolo was. I can't believe they could say, well, Blankfein met him and didn't know who he was. And there were all these questions about, don't do deals with him. And even after one M D B, even after this whole fraud collapsed, there were Goldman bankers in the Middle East,

• 32:14Speaker 02

  a guy called Hazem Shauqi, who continued to do deals with Jolo, with compliance telling him, look, you've got to keep Jolo. You can't do the deal directly with Jolo. Jolo has to be on the other side. And they did these investment deals. It's a very complicated story. But the point is, they knew Jolo was there. They knew they had questions about Jolo. But they did all this business anyway, because the fees were just so, so, so high, right?

• 32:38Anthony Pompliano?

  Yeah, capitalism drives a very specific type of activity. What do you think happens in the US, right? So there's the guilty plea or not guilty plea, kind of wherever that comes out. But from a fine perspective, are you expecting something that's going to be bigger than the $2.5 billion settlement with the Malaysian government, smaller? Just talk me through what your expectations, I guess, are right now.

• 33:01Speaker 02

  Well, I went, I actually went on Squawk Box with Andrew Ross talking, maybe a couple of years back now, or eighteen months ago, and I said, he asked me, what fine do you think they would do? And I said that they would put on Goldman. And I said the US would put a fine of two billion. And very senior Goldman executives phoned up the Wall Street Journal and complained at that time, right? That this was like, you know, and, and the yardstick then was, well, JP Morgan had been fined two billion for Bernie Madoff's accounts, which they had failed to, to signal, red flags, right? This is all done under the Bank Secrecy Act. It's not, it's not a criminal matter. This is, you know, you're fined for failing to see red flags and act upon them and tell authorities. And so if it's anywhere

• 33:42Speaker 02

  in the, in the sort of JP Morgan range, it could be another two billion, and that could be four, up to five billion. But the question is, does the Malaysian, how does the Malaysian fine relate to the US fine? Is, is there some sort of like overall number that Goldman has organized and they have to give it to Malaysian, not the US? I mean, I don't, I'm not quite sure on that. So we'll have to just wait and see. Yeah. And then the criminal matter is, is a separate thing. That's just, that's rolling through the courts, right?

• 34:08Anthony Pompliano?

  Yeah, it, it's very interesting to me. I, I read the book, Black Edge, which is about Steve Cohen and SAC Capital. This situation seems very similar in that, you know, there's almost this like weird negotiation. I think the kind of the average person hears, oh, there's law enforcement involved at, you know, whether it's the federal level or whatever. Hey, they're just gonna say, you're in trouble, you know, here's your charges, go to court. And, and basically you get whatever judgment you get, right? But here, there is very much this negotiation, like you talked about, when lawyers are going in and, and kind of they have the, here's what we're willing to do, here's what we're not willing to do, here's how much we're willing to pay. And then the negotiation starts. And so it almost feels like kind of the richer, the more powerful you are, the more leverage you have in these

• 34:51Anthony Pompliano?

  scenarios, because it's Goldman Sachs on the other side from the DOJ, not, you know, you, me, or any other individual.

• 34:57Speaker 02

  Yeah, like I mentioned, it's a revolving door problem. I mean Goldman's lawyers are Kirkland and Ellis, Bill Barley AG who's used to work there. I mean, there's no, I'm not sure he's recused himself on it. I think he got a waiver. So the question is, why has there not already been a settlement? This, this, these stories started coming out in 2015, the Civil Department of Justice attempts to take their assets, started in 2016, went now in 2020. So I have huge questions about, I mean, our book came out almost two years ago. I think the broad contours of this have been known for, for a while, right? And so why, why has there not

• 35:40Speaker 02

  been a settlement? So, well, yeah, exactly. There's a, there are very powerful lawyers that have to negotiate with the Department of Justice to, to, to try to work out what Goldman's willing to pay and willing to do. And that's a fascinating process to watch. And of course Goldman says, as I mentioned, they say, look, we didn't know, this is the line they'll be pushing very hard. We just didn't know that, you know, Lloyd Blankfein did not know that Tim Leisner, the partner, was, was dealing corruptly with Joe Low. And I think that's probably right, actually. But it's, but it's, on, on every other level, you know, is it true that Goldman didn't know that there were red flags here? I mean, well, demonstrably not, because their, their own compliance department, you know, knew

• 36:21Speaker 02

  that there was problems opening an account for him. So, so, so, yeah. But Goldman is, Goldman is obviously an extremely powerful institution and is able to, has been able to sort of stretch this out over a long period of time.

• 36:35Anthony Pompliano?

  Yeah, it's obviously a very, very complex situation. I want to talk a little bit about your process in writing the book. So I asked people for questions beforehand and a couple of people asked, you know, some variation of just, you're dealing with a lot of money, a very fraudulent, complex situation, very powerful people, or people who are very egotistical. What were some of the things that people did to stop you from either getting information, getting access to people, or really kind of being able to complete the body of work?

• 37:03Speaker 02

  Well, at one point I was in Malaysia, reporting in, in a hotel in Malaysia.

• 37:10Speaker 02

  And Bradley Hope, who's the co-author of the book, my great friend, he was called up by one of our sources who was close to the Malaysian Prime Minister and told, "Look, the Malaysian Prime Minister is trying, is thinking of arresting Tom in Malaysia, and he should really get out of the country." And it was framed as a, as a sort of friendly advice, but actually it was this person we later found out was, you know, in cahoots with the Prime Minister. And so, things like that, just trying to stop us reporting on the ground.

• 37:37Speaker 02

  A lot of legal threats, crazy number of legal threats. You know, so for example, we'd, we'd write to, I don't know, Christie's, for example, who did a lot of, Jolo became one of the biggest buyers of art in the world. And they would immediately, you'd write a bunch of questions from what we were going to say in the book, which was very sort of, you know, fact-based. And they'd write back with a very, very aggressive letter. Same with Tepperberg and Strauss, who are these two guys who run the Marquee nightclub in New York and Labo in Vegas. You know, very aggressive legal letter back when you said to them, "Look, we're going to say that you organized all of Jolo's parties over a long, multi-year period, and were paid a lot of money to do so." And so, you know, it was very stressful at that time because we were fact-checking.

• 38:22Speaker 02

  You know, in the book, it's almost 400-page book, and there's an allegation on almost every page. And so, we checked with every single person. I think at one point, you know, the prologue of the book is this big party we mentioned on, in the, you called it an aircraft hangar, it almost looked like an aircraft hangar. We talked to every single person who was supposed to be there. So at one point, I think we called up Jonah Hill's agent and said, you know, was Jonah Hill there? And they said, "Oh, actually, he was supposed to go, but he was on the guest list we had, but he didn't turn up." So, you know, it was super fact-checked. And people did, people would just, they would do anything to try to stop the book. And then, sorry, the elephant in the room is Jolo's lawyers. Shillings, they sent letters to all the bookshops that were going to carry this book around

• 39:05Speaker 02

  the world, saying if you stock this, you could be liable to a defamation suit, which was nonsense, because why would a bookshop, I mean, it's the writer of the book, he should get a defamation suit, but it was all, it was all just a tactic to scare people not to have the book. And it was, it was, it's what's called the Streisand effect, which is when Barbra Streisand tried to stop people posting her photos and everyone ended up looking at them, right? The book just got like much more attention because of all that. So none, none of it worked, but the truth comes out eventually.

• 39:31Anthony Pompliano?

  It, it's literally like the perfect book to write, right? I mean, you've got financial fraud, billions of dollars, a bunch of famous people, very powerful people, I mean, just literally, you know, it kind of sells itself to some degree. Were you ever able to talk to Joe Lo's attorneys or to Joe Lo himself?

• 39:47Speaker 02

  Yeah, we, we definitely talked to his attorneys and sent lots of questions to him via them, but they, they have not, they have not engaged Shillings and Cobra and Kim, who are his lawyers in the US, did not engage with us in any way over a multi-year period. I mean, they would engage with us, but just with pro forma letters, saying that we, you know, we're not doing, we're not allowing his side out, but they never answered any, Joe Lo via his lawyers has not until today answered any substantive questions. And we should talk about where Joe Lo is, by the way.

• 40:14Anthony Pompliano?

  So what are my questions is going to be, where, where do you think he is?

• 40:18Speaker 02

  Well, I mean, well, we knew he was in China at one point. So, so we should say the lawsuits, the civil lawsuits, 2016 in the US, and then in 2018, the US and Malaysia both filed criminal charges against Joe Lo. And at the same time, the Prime Minister of Malaysia, Najib Razak, loses power in an election in Malaysia and he's, he's arrested. And I think his, Najib's verdict, by the way, might come out today in Asia or, or tomorrow or something like that. So Joe Lo is told by the Prime Minister to, to get out of the country and he goes to China. And this is, this is where the story gets very complicated, but it's just unbelievably interesting. He's able to do deals. So, so Najib at that point is still Prime Minister before he loses power in the

• 41:02Speaker 02

  elections. And he's able to do these infrastructure deals with China and Malaysia, and they steal even more money. This is not the one MPV fraud, this is just post-one MPV to use to, to, to fill some of the holes. And he uses a friend in Kuwait, who's the former Prime Minister's son, excuse me. And he's able to, he's able to sort of keep doing deals. And China has not said anything about it. But we got minutes of a meeting. We know that Jolo's protector in China at one point was a guy called Sun Li Jun, who was head of the domestic security forces. That guy has just been arrested for corruption in China, without any comment by Xi Jinping's government. So we believe there's a sort of a clearing of house going on in China about this.

• 41:47Speaker 02

  But Jolo is still there. And of course, he's a very useful pawn for anyone who holds him, right? Because, you know, he knows all this stuff about where the money's gone. He still controls a lot of money, too. And he's still paying his lawyers, which we don't understand how he can do. But he's still paying his lawyers in the US, millions of dollars, so.

• 42:05Anthony Pompliano?

  So any idea where he is in China? Or just kind of the general idea is just in China somewhere?

• 42:14Speaker 02

  Well, this isn't a joke. He was definitely in Wuhan at one point. We have, we have sort of intelligence that he was in Wuhan. This is before the virus started.

• 42:24Speaker 02

  Since then, to be honest, that would be very early this year, or actually late last year. Since then, I don't know exactly where he is. But I'm not sure whether he can travel. It's possible he can travel, or until recently, he's been able to travel into the Middle East, the UAE, to, because a lot of people are trying to cover this up, right? For example, the UAE was involved, involved in this. Sheikh Mansour, the owner of Man City Football Club Soccer Club in the US, in England. He, his boat, the $650 million Topaz, which is now called the A+, was partly financed with money stolen from OneMBV. So there's a lot of people who don't really want this, you know,

• 43:02Speaker 02

  to be rigged over. And so it's possible Jolo can travel to those countries, too, on private jets. But I imagine the Chinese authorities are keeping him pretty much in their sights, right? Because they want to control him.

• 43:13Anthony Pompliano?

  Yeah, absolutely. And is the thought process, when you say he's got control over money, is that something that is just, nobody really understands, but he's obviously paying some of these bills that we know are expensive? Or is it something where we think he's literally walking around with duffel bags of cash? Or kind of, how do you think that somebody who is really this like international wanted man, still has control over money and can kind of do some things?

• 43:38Speaker 02

  Well, he moved money into Chinese yuan for sure, because when he was trying to pay off some of these corrupt deals I just mentioned, they were moving it around by ICBC, which is a Chinese bank in yuan. And the reason to do that is to avoid, if you do a dollar transaction, you could end up getting caught by the correspondent bank, right? It has to be, it has to be checked. And so he's basically been frozen out of the US system. But he's, I think he's still got access to Thai baht or Chinese yuan and all of, all these currencies. He tried to buy a bank in, I think the Komora Islands at one point, post all this coming out, right? So he could control money. And obviously China's becoming a bigger, bigger player in the global economy. And so you can do stuff with yuan and you, and it's, and it's not, you know, it's, it's to a degree a bit more internationalized than it used to be, even though they still have a closed capital, capital account, right?

• 44:22Speaker 02

  So that's, that's, I think, how he's operating. But it's incredible to me, the, the big question I have is Cobra, Cobra and Kim, right? His lawyers are, they're, they're a big law firm, Shillings in the UK. They're getting paid money, they, Cobra and Kim had to file a form, a FARA form, which is to show to the US government that they're lobbying for him. And they're not, they're not obviously paid by him. They're paid, they were paid by a Thai guy, a Thai friend of Jolo's. But, but I don't understand how you can say, well, you know, we know that this money is not the proceeds of crime. You know, lawyers, everyone's, everyone's allowed a lawyer, right? And that's, and Jolo has not been proven guilty. Now, he's, he's only, he's only been, he hasn't turned up to face the charges, but he hasn't been proven guilty. So that's fair. He needs a lawyer.

• 45:04Speaker 02

  But to, but for, for, when it comes to taking lawyers, taking money to do lobbying, to send letters to try to stop a book being published, like Billion Dollar Whale. I mean, then I have questions about, well, how do, how are those lawyers proving that the, the money was not tainted? Extremely, extremely interesting situation.

• 45:23Anthony Pompliano?

  Yeah, the, the part to me that I think just blows my mind is you've got a guy who, it almost seems in some weird way, has a very tainted reputation, but has become emboldened after the scam was uncovered. Like, you, you almost get like the, one of these weird things where you, you could imagine this guy is like bragging about the fact that there's a book written about him. And he just forgets the part of like, that it's written about a scam, right? Like, like, it's almost like the, the fame and the egotistical nature of all of this is driving him to do more and more to some degree. It, it sounds like from some of these stories.

• 45:58Speaker 02

  Well, his favorite book, we learnt, was the book about Mark Rich. So Mark Rich was the oil trader who ended up getting charged to the US and he lived his life out in Switzerland on the shores of Lake Lugano in a luxurious villa. And I think Jolo sort of saw this guy as his model in a way. And Rich was pardoned by Bill Clinton on his last day in office. And so I think Jolo really saw that as his endgame to get a sort of a pardon. And as I said, the story is super complicated, but making it even more complicated, the party of Najib Razak, the former prime minister who's been arrested, is now coming back to power in Malaysia. And so there's this idea that maybe all the charges will get dropped in Malaysia if

• 46:43Speaker 02

  that party solidifies its grip on power and then Jolo might be able, might actually be able to come back to the country. I mean, it's not unbelievable. I mean, it's a very, very corrupt place.

• 46:53Anthony Pompliano?

  Is his family still in Malaysia?

• 46:55Speaker 02

  No, they're all on the run with him. I mean, I think his dad has been charged by the Malaysian government. So there was a change of power in Malaysia and the new government pushed ahead with all these charges. But then that government is now out of power again. And so, you know, it's a fluid situation.

• 47:12Anthony Pompliano?

  Yeah, absolutely. In terms of writing the book, were there any kind of really crazy stories that didn't make it into the book or things that you guys wanted to write about, but you just couldn't get confirmation or anything like that?

• 47:25Speaker 02

  There was one thing we didn't put in, which subsequently, I think, the New York Post has reported, which was Kim Kardashian was given a white, and Chris, what was her husband called, Chris Hudson, Chris, a former husband?

• 47:38Anthony Pompliano?

  Humphries.

• 47:39Speaker 02

  Chris Humphries. The two of them had been given by Jolo at a wedding, a white Ferrari. And then, of course, they got divorced a few days later and all the wedding guests were complaining that their gifts had not been returned. But there was a mention in a legal filing, I think by Chris Humphries, that, you know, I haven't got my fair share of the wedding gifts, including a white Ferrari from a Malaysian businessman. And I think the New York Post has confirmed that was Jolo. And so that, I don't know where that white Ferrari is. I have an interest in finding out whether that was ever given back to the US government or not, or whether Kim Kardashian still has that car.

• 48:16Anthony Pompliano?

  I mean, the stories, every single time you hear one of these, right? It's just like so crazy how entrenched he was into US politics, culture, kind of business. I mean, he literally was able to infiltrate everything.

• 48:29Speaker 02

  Well, we haven't even, well, we haven't even talked about how we tried to infiltrate the White House. We tried to do with Obama the same thing he had done with, you know, the Malaysian prime minister, the powers that be in the Middle East. He actually met Obama once. He got close to a guy that was, there was an Obama fundraiser. He, who was a sort of distant relation of Michelle Obama. And he, he, that guy was a businessman and he did all these sort of weird business deals that made that guy a bunch of money. But of course, it's not as easy to infiltrate the White House as it is to, to do that with Malaysia and, and the Middle East. And so he wasn't, he wasn't really all that successful in getting that close to Obama. But he did, he did via Pras Michelle, who I don't, do you know who Pras Michelle is?

• 49:09Anthony Pompliano?

  I do not.

• 49:11Speaker 02

  Yeah, this is, this is generational thing. Pras Michelle was the rapper from the Fugees, you know, the Lauryn Hill group. And so Pras Michelle, who literally opens our book, became a really good friend of Jolo's. And he, he illegally, well, allegedly illegally contributed to the Obama reelection campaign. Because of course foreigners are not allowed to contribute into US politics. But Jolo used Pras Michelle as a scoreman allegedly to pay, to put money into a super PAC for Obama's reelection. So that was all part of his attempts to get closer to, to the White House. And Pras Michelle was facing a bunch of problems because when all this came out, Jolo also tried to get the Department of Justice to drop all these investigations into one M D V.

• 49:53Speaker 02

  And he, he actually offered Pras Michelle $300 million if they were able to, Pras Michelle was a friend of the Department of Justice, and they were working to try to influence the investigations in some way. And then, then, yeah, all of that stuff is, all that stuff didn't work out either. So fascinating.

• 50:09Anthony Pompliano?

  Yeah, it's one of these things where, when people have money to just throw around, $300 million is just crazy. And I think there's a story at one point there in, somewhere in Europe, maybe, maybe a Beza or something, and they're like at a club. And he's basically just spending, you know, a million, two million bucks at the club on a single night. You're just like, look, you know, you start doing the math, that's a lot of bottles or that's, you know, a lot of really expensive bottles of alcohol to spend $2 million in a, in a club in a single night.

• 50:36Speaker 02

  Well, yeah, that was, you're referring to a, he got into a champagne battle with Winston Fisher, who's a New York real estate family. And they were, they were bidding each other in the Car du Wa, which is a famous nightclub in, it's actually in Saint Tropez, not Ibiza. And yeah, they, he, they sort of bid each other up to some crazy number. I think it was 2 million euro in the end. It was, it was, he would go into a club and just say, crystal for everybody, you know? And so people quite enjoyed hanging with that. And there's, there's, there's another sort of famous scene in the book where they do a double Dateline, New Year's Eve, they go to Sydney and then they go to Las Vegas. And, you know, Jamie Foxx is in the plane and Swiss Beats is in the plane. And there's all these photos on Instagram, you know, of them just having buckets of crystal everywhere.

• 51:22Speaker 02

  Yeah, I think people are kind of sick of this.

• 51:25Anthony Pompliano?

  Absolutely insane. Talk to me a little bit just about, you wrote this book, went super deep on, on this specific fraud and kind of really unpacked like how a fraud comes together, how it gets enabled and kind of what the money, you know, what, what people do with the money. How do you think about this getting repeated in the future, right? Whether it's now during kind of COVID and the economic recession, or maybe at some other time, like, are you looking for kind of the next, you know, one M D V type scandal? Or do you kind of just wait for them to come to you?

• 51:59Speaker 02

  It's a hundred percent going to happen again. I mean, you know, there's, there's a, there's a case, it's also rolling on right now, very similar involving Credit Suisse and Mozambique, where they, they bought a bunch of tuna fishing boats, the government bought some fishing boats. And it took out a $2 billion loan with, by Credit Suisse and some other banks and a couple of Credit Suisse bankers have been charged, I think. But it is very similar thing, you know, huge loans from the market, a country without rule of law on one side. And that, that's, you know, that's a big problem. I mean, look, I talked to my Goldman friends and they say you can't get, it's hard to get deals through now because you've got to go through extra stringent procedures at the Capital Commitments Committee and all of this. And there are good people at Goldman, of course, it's not like full of people like

• 52:43Speaker 02

  Tim Laxner and just banking.

• 52:47Speaker 02

  Fill a function in our world, yeah, it does. But I think at the margins, there's always going to be people who want to make big bonuses and are under pressure to make big they're they're big, you know, deals. And, you know, they're not that easy to come by. That's the big secret in banking, right? It's just not that easy, especially if you're in a fairly small market like Southeast Asia, like Tim Leistner was. You want to make partner, you ought to do a big deal. And how do you, you know, if you're doing deals in China right now with Chinese companies, how do you know? You sometimes you don't even know who owns a Chinese company. It might claim to be private, maybe the government's behind it. And so it's very hard to do the kind of due diligence you need to do to stop these frauds happening. And you could argue that just part of the way, you know, capitalism works, you need, it'll happen.

• 53:30Speaker 02

  And but you need, you need open markets, you need, you need this for the, for the, for the way our world works. But you need to also have regulators who crack down on it. I think that's the key.

• 53:41Anthony Pompliano?

  Yeah, and and it feels in some weird way, you know, you see the kind of luck in coffees in China that come out. And, you know, I think the consensus in the market is that it was some sort of fraud or scam or whatever. And and there's almost like two categories, right? There's the like, oh, that they were just lying about their numbers. And so there was financial engineering going on. Or there's like this, which is, hey, they fraudulently got access to billions of dollars and then they went and they spent it on Ferraris and, you know, yachts and jets and kind of all the the crazy cliterati type lifestyle. And to your point, I think that the the more traditional like corporate fraud of just, hey, I said I have X number in revenue, but I didn't, almost has been, we've been desensitized to some degree to that. It's this type of stuff now where people are, you know, they're still blown away when they see somebody got hold of

• 54:26Anthony Pompliano?

  six or seven billion dollars in cash and then went and literally blew it across the world, you know, with the rich and famous in the world.

• 54:32Speaker 02

  Well, I mean, I, I mean, yes, I think, I think you made a great point. I mean, I listened to the We Crashed podcast about WeWork, right? And I'm like, well, that's no, no one's saying Adam Newman did anything fraudulent, okay? But we have become desensitized because, you know, how are the stewards of that company allowing that kind of spending to go on, right? And I think that's probably how Jolo, in his own mind, would justify his actions. He'd say, look, I'm, I was just doing. What you know, the Jordan Belfords of the world did. And you know, this is just how this is how smart people make the most of this system, right? And you know, we didn't want to make the book too preachy or anything, but I think there's a couple of moments where we try to say, look, I mean, if we want the system.

• 55:11Speaker 02

  And it's all tied up with everything that's going on right now, inequality and people's sense of like, I'm working on a, on a, you know, six dollar an hour job or whatever it is. And they're sick of that and they see all this.

• 55:22Speaker 02

  If you don't, if you don't like make it more equitable, then the system is just not going to work in the long run. So.

• 55:28Anthony Pompliano?

  And, and one of the last questions I have before we get into some rapid fire questions to finish up is just. He made, he financed The Wolf of Wall Street. And so there's some irony in a fraud financing a movie about one of the most famous American frauds in history. What was your take on that? And kind of was that more of a, I've got to tell this and this is like a bat signal to the world that I'm a fraud? Or was it just coincidence? How did you guys kind of look at that?

• 55:55Speaker 02

  Well, I think it's like, it follows on from what we were just saying. I don't think Jolo is, is that smart or into literature to think that it was so meta? That he had to do such a meta move. I don't think that was what was going on, but I think. He was attracted by the, the people like Jordan Belford. And he was attracted by DiCaprio, you know, who had played Jay Gatsby. You know, in the, in, in Baz Luhrmann's film of The Great Gatsby. And so this was, this was a very meta situation where Jolo was, was meeting Jordan Belford and, and DiCaprio was, who was a character actor was meeting Jolo. I mean, DiCaprio says he didn't know he was a fraud at the time. But I don't know, I don't think he had any sort of great intellectual idea that this was such a meta move. I just think he was attracted to those kind of people.

• 56:40Speaker 02

  Because he, and he saw it as sort of a valid, you know, you're a loser in capitalism if you don't make these kind of, you know, badass moves, probably something just like that.

• 56:50Anthony Pompliano?

  Absolutely insane. I asked two questions to, to wrap it up and then you could ask me one as the last one. But what is the most important book that you've ever read?

• 57:01Speaker 02

  Oh, most important. Well, one of my favorite books is A Shelter in Sky. Which is, which is a, actually I've got it here on my bookshop, I think. But it's by, it's a guy called Paul Bowles. And it's a fantastic, fantastic novel, set in Sub-Saharan Africa. That's, that's, that's what, that's my favorite sort of fiction. Terms of important book of nonfiction.

• 57:26Speaker 02

  Well, I've just read Rutger Bregman's book about happiness. Which is, shall I just step up and pick it up very quickly?

• 57:34Anthony Pompliano?

  Sure, go ahead.

• 57:37Anthony Pompliano?

  For those that are, are listening, Tom is literally going to the bookcase behind him right now and grabbing the book. Which is, makes him an expert because he knows exactly where the book is.

• 57:50Speaker 02

  Well, I just read it. So, so this, this book, Humankind. By a very smart, young Dutch thinker. Is, it's trying to, it's, it's, it's sort of like, it goes against the grain of the Jared Diamonds, you know, and the, the Steven Pinkers and this idea, well, actually maybe not so much Jared Diamond, this idea that, you know, humans are bad. And that, and that, you know, we have a deep core of badness. And he's trying to say, look, we have, we, we actually are deep down, good people and, and he spins it into a fantastic, fantastic book. And he starts off by talking about the famous Lord of the Flies, William Golding's book. And he finds a real life example of boys who were marooned in the Pacific and they did not end up

• 58:34Speaker 02

  almost killing each other. They cooperated and they kept the fire going and all of that. I just found this, I found it a fantastic book, really, really great read.

• 58:41Anthony Pompliano?

  And, and the author's name is Rutger Bregman?

• 58:44Speaker 02

  Rutger Bregman. He's the guy, you might remember him. He went to, he went to, he's the guy who went to Davos and to all the TED Talks. And sort of talked about basic income and all that kind of stuff. And he's, he's sort of like the anti-Davos guy, very, very smart, very, very well-written, brilliantly-written book.

• 59:01Anthony Pompliano?

  I love that. The second question is a little bit more fun, which is aliens, believer or non-believer?

• 59:08Speaker 02

  Nonbeliever.

• 59:09Anthony Pompliano?

  Wow, why a nonbeliever?

• 59:12Speaker 02

  Um, just a rationalist atheist.

• 59:18Speaker 02

  You know what, I haven't even given it much thought. I don't, I've never been that pulled to, you know, stargazing and thinking about what's out there. I, I think, you know, like, I'm always amazed when I read history that, that, like, I just think most of it's probably made up. When you look back at, like, people talk about herodotus or something, we, we can't, I couldn't to even know what happened between two thousand and nine and two thousand and fifteen with this one MTV fraud was difficult enough, right? And getting multiple sources on, on things. So I find like, um, you know, whether aliens exist or not is so far beyond, you know, my comprehension. I, I wouldn't even go there.

• 59:50Anthony Pompliano?

  I, I recently tweeted saying that one of the greatest lies we tell ourselves, uh, lies in our memory. Right? Are just our personal memories are so bad, yet we have a hard time admitting that to ourselves. And so if your memory is bad, imagine how poorly history is written, right? From an accuracy standpoint.

• 1:00:05Speaker 02

  Exactly. Exactly. That's why I like dealing in narrative nonfiction because it's not opinion. You just find out what happened and, and you, you know, you don't, you try to give as little opinion as possible. Um, I don't know how all these columnists, uh, you know, and also there's so much opinion right now. If you, you go on Twitter or so much posturing and so little actual reporting amongst, amongst some of the younger journalists, I hate to say, but yeah, I feel like you just need to get facts because that's the only way to, to, to go forward.

• 1:00:31Anthony Pompliano?

  Absolutely. Uh, you get to ask me one question to finish up. What's the one question you have?

• 1:00:37Speaker 02

  Yeah. So I, I've noticed that, that there's amongst people who are into, into Bitcoin. This book is very popular because they, they, they keep making the argument, well, this huge fraud shows that, uh, you know, fiat currencies are, are not the way to go when it comes to stopping fraud. But I don't, I, I'm not sure I buy that either. I feel like Bitcoin is, is also going to be a great neighbor of fraud. So what do you think about that?

• 1:00:59Anthony Pompliano?

  Yeah, so there's two pieces to that. So I've definitely seen a lot of people who say that. I think that there's kind of two parts to the fraud, which is could something disincentivize or prevent the fraud from occurring? And then is there something on the back? And once the fraud has happened, would it be better for it to have happened in fiat or in cryptocurrency or Bitcoin, or whatever it is? I definitely am with you that I don't think that Bitcoin or fiat, or really any currency in the world would necessarily prevent this from happening, right? Money is money, and bad people are going to figure out bad things to do. And so there's bad people who use Bitcoin for things. There's bad people who use US dollars and every other currency in the world. So I kind of don't buy that argument. I think what the argument that I see,

• 1:01:42Anthony Pompliano?

  I see the validity of, yet I don't think necessarily people have kind of thought through the second and third order effects of is, oh, if Bitcoin had been used, you then could, because it is a public ledger, basically track down the funds easier. Technically, yes, or kind of from an academic standpoint. But as we've discussed, if you take the currency, again, whatever currency it is, and you turn it into assets, it kind of, you get back to square one, right? So like, if I take it, you know, whether it's US dollars or Bitcoin, I turn it into a $35 million jet, you still got to go find the jet, right? And so I think that, yes, if it was all sitting in cash, you could track it down, or at least kind of get a better picture if it was in Bitcoin versus fiat. But, but once it's in assets, I think, you know, it kind of

• 1:02:25Anthony Pompliano?

  doesn't really matter. In terms of like, just Bitcoin on a grander scheme, to me, it really comes down to, you're either going to have government-controlled currencies, or you're going to have separation of state and money, right? And I always tell people, it's like, the separation of state and money is probably low probability, but it's possible, right? So you kind of have, you have possibility, but low probability. And if it does occur, it will be massive value creation, right? Because it's kind of one of these, you know, very small chance of happening, but if it happens, it will be so outrageous in terms of value creation. And I think that's also kind of pulls certain types of people into it, where they say, you know, I want the one in a million chance of getting right.

• 1:03:09Anthony Pompliano?

  Right or whatever. And so I try to spend a lot of time talking people back into reality a little bit and like, hey, you know, put 1% of your assets there and like, you're good. And if it happens, it happens. Great. But like, don't go put 99% of all of your money in Bitcoin and cross your fingers and hope, you know, it turns into kind of a trillion dollar asset. But there's, I mean, literally, there's people who tweeted me all the time and they're like, hey, you know, somebody tweeted me yesterday. It was like 94% of my wealth is in Bitcoin and Ether. And all I could think to myself was like, Jesus, that is not a smart move. So I don't know.

• 1:03:41Speaker 02

  Free, free financial advice. Sorry. Good.

• 1:03:43Anthony Pompliano?

  Yeah, exactly. Like, you know, I, I joke with my personal time, like, I never thought that as an investor, I would spend time telling people like, put less money in, right? Because most investors are always saying, but hey, you know, you can do more, you can do more. But with this one asset, it's just so volatile. And I think it definitely attracts kind of a certain personality type that you literally have to talk people kind of off the edge and go like, hey, just chill out. You'll be all right. Like cash is not, you know, horrible. You can hold some cash, you'll be, you'll be good. So I think it's funny. Where, where can people find the, the book if they want to go buy it? I know there's an audio book and then also.

• 1:04:16Speaker 02

  It's, yeah, it's everywhere. It's everywhere. Amazon, Barnes and Noble. It's in all the bookstores. And we should say, we're making a film out of it. The, the, the film company that made Crazy Rich Asians, if you saw that film in 2018, they, they bought the rights to it. And so they're turning it into a probably into a TV series. So that's in progress. Yeah. Very exciting.

• 1:04:37Anthony Pompliano?

  Absolutely. And, you know, for everyone who's listening, I almost never give book recommendations, but this is one that I highly suggest going to read because it's, it, one, I read it very quickly, but also two, as you walk away with this rare combination, I think of kind of the entertainment factor of a lot of stuff we talked about here, but you also learn, you know, just how does the global financial system really work, especially in areas where you've got US-based financial organizations operating in other countries or other regions. And you just kind of get a different picture of the world. And, you know, Tom is based in Asia. And so I'm assuming that, you know, that definitely helps you write from kind of a non-Western perspective, which is pretty compelling as well.

• 1:05:19Speaker 02

  Yeah, that's yeah, that's right. It's uh, we had a rule that we would have only one one page of money flow before you get back to something else because otherwise people don't read people. Corruption is important, but people don't care to read about corruption. Right? So yeah, it's not a it's not a book about corruption. It's not a book about money trail. There is some money trail in there, but you can always just skip over that if you.

• 1:05:37Anthony Pompliano?

  They just want to know about the parties and the yachts and the jets, man.

• 1:05:42Speaker 02

  And I mean, and the way the world really works, right?

• 1:05:46Anthony Pompliano?

  Absolutely. All right, Tom. Listen, thank you so much for doing this. I think with the recent news with the Goldman settlement, people are just super interested to kind of hear from you. So as we learn more, we'll do it again in the future.

• 1:05:56Speaker 02

  Thanks, dude. I enjoyed it.