Published: Wed, November 14, 2018

Goldman Sachs Bankers ‘Cheated’ Malaysia Over 1MDB: PM Mahathir

Goldman Sachs Bankers ‘Cheated’ Malaysia Over 1MDB: PM Mahathir

1Malaysia Development Berhad (1MDB) is a state-owned development vehicle founded by the Najib administration in 2009.

Goldman fell 0.9 per cent at 1:43 p.m.in NY, while every other major USA bank climbed.

Goldman has "admitted culpability" after former banker Tim Leissner entered a guilty plea for his role in the scandal, Mr Lim told radio station BFM.

Goldman Sachs is in the cross hairs of Malaysian and USA investigators over its role in the 1MDB scandal.

Goldman Sachs' Malaysia problem keeps getting stickier.

Malaysia Prime Minister Mahathir Mohamad said on Tuesday US prosecutors had promised to help return money that Goldman Sachs charged for its dealings with troubled Malaysian state fund 1MDB.

A Goldman Sachs spokesman in Hong Kong declined to comment on the interview.


Malaysia's finance minister reportedly asked for Goldman to return the $600 million in fees it received for underwriting three bond deals that raised $6 billion - about half of which the hard-partying Low used to allegedly bribe foreign officials and fund his opulent lifestyle.

Goldman has consistently said that it believed proceeds of the debt it underwrote were for development projects and that Leissner, its former Southeast Asia chairman, withheld information from the firm.

Goldman has said the outsize fees related to additional risks: it bought the unrated bonds while it sought investors and, in the case of the 2013 bond deal which raised US$2.7 billion, 1MDB wanted the funds quickly for planned investment. He said the rate Malaysia had paid was about 100 basis points higher than the market rate.

"The US Department of Justice (DoJ) said that the total was around US$4.3 billion". He has pleaded not guilty.

Goldman's litigation risks in the U.S. include lawsuits and probes with estimated costs that could top US$2 billion, including more than US$1 billion from 1MDB matters, according to Bloomberg Intelligence analysts. The firm said in a quarterly filing earlier this month that it couldn't predict the outcome of the US Justice Department's investigation, but said it could face "significant fines".

Shares in the USA investment bank, which now also has retail arms in the United Kingdom and U.S., had their worst day in 7 years, falling 7.3 per cent to close at their lowest level in two years. Leissner said in his guilty plea unveiled on Friday that others at the bank helped him hide bribes used to retain business in Malaysia.

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