Goldman Sachs agrees to pay Malaysia $ 3.9 billion in corruption case

Goldman Sachs agrees to pay Malaysia $ 3.9 billion in corruption case
Photo by FAZRY ISMAIL EFE

Financial institution Goldman Sachs will pay $ 3.9 billion to Malaysia for its involvement in the money laundering and corruption scheme through state investment fund 1Malaysia Development Berhad (1MDB), the finance ministry announced this Friday.

“This agreement involves returning assets that rightfully belong to the Malaysian people. We are confident that we are getting more money from Goldman Sachs compared to previous attempts, which were far below expectations,” said Zafrul Aziz, Malaysian finance minister in a statement released today.

The agreement ends the legal dispute initiated by the Malaysian Prosecutor’s Office in August 2019 over the role of several Goldman Sachs executives in managing three bond transfers for a total value of $ 6.5 billion by 1MDB between 2012 and 2013.

Under this agreement, Goldman Sachs will make a payment of $ 3,500 million, guarantees the recovery of assets worth at least $ 1,400 million from the funds diverted in the three transactions and is committed to helping the Malaysian Government recover other assets.

The 1MDB corruption plot came to light in 2015, when various media denounced the diversion of some $ 681 million from the fund to private accounts of the then Prime Minister, Najib Razak.

The case contributed to Najib’s 2018 election defeat, which has been charged with 42 charges, including money laundering and abuse of power since he lost office.

The US Department of Justice estimates that about $ 4.5 billion was diverted from 1MDB, of which about $ 1 billion would have been laundered in the US with the purchase of the real estate, yachts, jewellery and works of art, among other goods.