‘Total Joke’
The letter sent by Bani’s lawyers, used by the LIA to support its case, makes a number of allegations against Goldman Sachs, including that a trader at the bank had called its LIA transactions a “total joke” because the fund didn’t understand anything. Vella said he wasn’t aware of the comments and denied the letter’s claim that Goldman made excessive profits from the deals. The letter also alleged that Libyans had asked a Goldman banker for a bribe.
“I think he may have misconstrued, misrepresented things,” Vella said.
Vella also denied getting so angry with Youssef Kabbaj, the Goldman banker then closest to the LIA, that he once took off his shoe and banged it on the table.
“Do you say ‘the Italian shoe incident,’ as it is referred to elsewhere, never happened?” LIA lawyer Philip Edey asked.
‘Shoe Risk’
“I really don’t remember that happening,” Vella said. Kabbaj, who has since left Goldman Sachs, referred to it in a letter he sent to the bank cited by the LIA. The letter alleged that Vella became angry after Kabbaj complained to senior Goldman executives about him. Edey later read out a text sent by Kabbaj to Vella asking if he could call an LIA executive “without taking the Italian shoe risk.”
“I don’t know what he is referring to,” Vella said. He explained that Kabbaj was trying to put pressure on the bank after his position was put in doubt by saying “a lot of bad things were done.”
Vella’s impression was that the Libyan executives were “financially sophisticated” and experienced enough to understand what they were doing, according to a written statement he filed in the case.
The LIA has claimed that Goldman Sachs gave an internship to a Libyan executive’s brother to entice the fund into signing deals. Vella said the internship was part of an effort to train future LIA leaders and “it was not unusual at the time to give training to employees of clients,” according to his statement. He said he didn’t think it influenced any of the deals.