Support Just the News

Help Fund Honest Journalism

Donate

Goldman Sachs reaches nearly $4 billion settlement with Malaysia over 1MDB scandal

The investment bank has agreed to pay $2.5 billion in cash and guarantee the recovery of at least $1.4 billion in assets

Updated: July 24, 2020 - 2:40pm

Goldman Sachs reached a $3.9 billion settlement with Malaysia, ending a longstanding dispute about deals the bank ran for a state investment fund.

Goldman Sachs will pay $2.5 billion in cash, and fully recover at least $1.4 billion in assets to resolve three bond transactions the bank oversaw for the 1Malaysia Development Bhd., 1MDB for short. 

“We are pleased to have reached an agreement with the government of Malaysia to resolve outstanding charges and claims against Goldman Sachs. Today’s settlement is an important step towards putting the 1MDB matter behind us and will help enable the Malaysian government to move forward with additional recovery efforts and to execute on its economic priorities," said the investment bank in a statement.

In 2012 and2013, Goldman raised $6.5 billion for 1MDB through several bond sales. U.S. officials estimate that more than $4.5 billion of those funds went to fraudulent shell companies controlled by corrupt government figures in Malaysia and Abu Dhabi. 

Last year, Malaysia filed criminal charged against 17 Goldman Sachs executives for their handling of the fund. The bank has agreed to assist Malaysia in its recovery effort of related assets outside the country.

Just the News Spotlight