Goldman Sachs will agree to pay 2.8 billion dollars (2.3 billion euros) and admit its guilt in the scandal says 1MDB, in order to put an end to the lawsuits of the American federal justice. This agreement, revealed on Tuesday, October 20 by the Wall Street Journal, due to be signed this week, comes in addition to the $ 2.5 billion the US investment bank has agreed to pay Malaysia.
At the origin of the planetary scandal, the sovereign wealth fund (1 Malaysia Development Berhad, or 1MDB) set up at the beginning of the decade by this Southeast Asian state, under the aegis of the then Prime Minister, Najib Razak . In 2012 and 2013, he raised $ 6.5 billion in capital, with the help of the bank, which offered itself a staggering commission of nearly $ 700 million.
Everyone had used in the case, in particular Mr. Razak, who recovered some 700 million dollars and was sentenced this summer at first instance by the Malaysian justice to twelve years in prison. The “mastermind” of the package is 39-year-old Malaysian financier Jho Low, now on the run and rumored to be in China. This flamboyant businessman, famous for his parties in Hollywood and Las Vegas, acted with the complicity of two Goldman Sachs associates, Roger Ng and Timothy Leissner.
The parent company escapes an admission of guilt
The bank tried to play the rogue partners’ score, but the deal did not work because the amount of the commission should have made the governing and controlling bodies tick, while the boss at the time, Lloyd Blankfein, physically participated in at least one meeting with Malaysian authorities. In early 2019, the Goldman Sachs supervisory board announced that it may withhold part of the deferred bonuses owed to Mr. Blankfein and his successor, David Solomon. Above all, Timothy Leissner, who had pocketed some $ 200 million, agreed in 2019 to return $ 47 million and, in addition, chose to cooperate with the American justice to mitigate his sentence.
This case will cost Goldman Sachs more than the $ 5 billion it agreed to pay in civil lawsuits because of its role in the sale of risky products that led to the financial crisis of 2008. It strengthens its reputation as a unscrupulous bank that she had tried to get rid of.
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