Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, hand-picks her favorite stories for this exclusive weekly newsletter.
Goldman Sachs has taken legal action against the government of Malaysia in a dispute over payments related to the 1MDB money-laundering scandal. The Wall Street bank claims that the disputed payments are not being recognized as part of its 2020 settlement.
This lawsuit adds to Goldman’s involvement in the massive embezzlement scheme involving the Malaysian state investment fund 1MDB. It remains one of the largest financial crimes ever committed and a painful chapter in Goldman’s recent history.
Goldman stated, “Today, we filed for arbitration against the government of Malaysia for violating its obligations to properly credit assets against the guarantee provided by Goldman Sachs in our settlement agreement and to recover other assets.”
The London Court of International Arbitration is where Goldman filed the complaint, according to a reliable source.
The dispute revolves around a settlement reached by Goldman in 2020. As part of the settlement, Goldman paid the Malaysian government $2.5bn for its role in the 1MDB scandal. Additionally, Goldman agreed to transfer at least $500mn in 1MDB-related assets by August 2022, or face a penalty of $250mn. However, there is disagreement between Goldman and Malaysia regarding the bank’s provision of the assets.
Earlier this year, Malaysian Prime Minister Anwar Ibrahim publicly called on Goldman to fulfill its settlement obligations. In August, he stated that his government had not ruled out legal action against the bank.
A representative for the Malaysian government could not be reached for comment. Bloomberg was the first to report on the complaint.
US authorities have alleged that $4.5bn from the 1MDB fund was misused and spent on luxury real estate, expensive jewelry, and even financing the Oscar-nominated film, “The Wolf of Wall Street,” which delves into financial malfeasance.
Malaysian financier Jho Low was accused of being the mastermind behind the scheme, but US officials have emphasized Goldman’s pivotal role. They argue that the bank should have detected warning signs that could have prevented at least some portion of the theft from the fund.
In connection with the 1MDB case, former Goldman banker Roger Ng was sentenced to 10 years in prison, while ex-Goldman partner Tim Leissner pleaded guilty to charges of violating foreign bribery laws and money laundering conspiracy. Leissner is scheduled to be sentenced in March 2024.
Denial of responsibility! Vigour Times is an automatic aggregator of Global media. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, and all materials to their authors. For any complaint, please reach us at – [email protected]. We will take necessary action within 24 hours.
