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Goldman Sachs has initiated a lawsuit against the Malaysian government over disputed payments tied to its 2020 settlement regarding the 1MDB money-laundering scandal. Goldman contends Malaysia failed to credit assets against the bank’s guarantee as per their settlement agreement. This complaint, lodged in the London Court of International Arbitration, arises from the $2.5bn settlement made by Goldman in 2020 for its involvement in the 1MDB case. The bank also committed to deliver at least $500mn in 1MDB-related assets by August 2022 or incur a $250mn penalty.
There’s disagreement between the two parties on whether these assets have been provided. The US bank’s action prolongs the intense legal tussle with Malaysia, which was assumed to end with the 2020 agreement. Malaysia’s PM, Anwar Ibrahim, earlier discussed Goldman’s need to fulfil its settlement commitments. Johari Abdul Ghani, head of a 1MDB-related taskforce, expressed surprise at Goldman’s move while suggesting good faith discussions were ongoing. The 1MDB scandal saw the conviction of Malaysia’s former PM, Najib Razak, and involved misappropriation of funds for luxury acquisitions and funding movies like “The Wolf of Wall Street”. While Jho Low, believed to be the plot’s architect, remains elusive, US officials assert Goldman’s crucial involvement.
The bank had facilitated $6.5bn in bond sales for 1MDB in 2012 and 2013, from which a significant amount was misappropriated. Former Goldman banker Roger Ng received a 10-year sentence related to this case, and ex-partner Tim Leissner confessed to related charges, with sentencing due in March 2024.
The entire article can be read at the link https://www.ft.com/content/b6f26a5e-152e-4c92-8ac5-061ff5d56a57
