Ex-U.S. Justice Dept worker pleads guilty in case tied to 1MDB scandal

WASHINGTON (Reuters) - A former U.S. Justice Department employee pleaded guilty on Friday to conspiring to deceive banks about millions of dollars in foreign lobbying funds, after he facilitated the financing of a lobbying campaign related to the U.S. investigation into the 1Malaysia Development Berhad (1MDB) scandal.

The Justice Department said in a statement that the alleged architect of the 1MDB scheme had hired George Higginbotham, who was then a senior congressional affairs specialist at the Justice Department, to help transfer tens of millions of dollars from foreign bank accounts to the United States.

Higginbotham said he had conspired to make false statements to banks about the source and purpose of the funds and also deceived banks with fake loan and consulting documents.

The money he transferred was then used in a lobbying campaign to resolve civil and criminal matters related to the department's investigation into the scheme to embezzle billions of dollars from 1MDB, Malaysia's state fund.

Higginbotham did not play a role in the investigation and failed to influence any aspect of it, the Justice Department said.

An estimated $4.5 billion was misappropriated from 1MDB by high-level officials of the fund and their associates between 2009 and 2014, the Justice Department has alleged.

Earlier this month, U.S. prosecutors unveiled criminal charges against two former Goldman Sachs bankers tied to the massive theft.

The Justice Department also filed a lawsuit to recover more than $73 million in accounts at U.S. financial institutions that Higginbotham allegedly helped open for Malaysian businessman Jho Taek Low.

The government has alleged Low and other conspired to launder billions of dollars embezzled from 1MDB, using part of the money to influence the U.S. investigation of the bank scandal.

Low, who is at large, has maintained his innocence through a spokesman.

(Reporting by Lisa Lambert; additional reporting by Jim Christie; editing by Jonathan Oatis and Tom Brown)