Gold­man Sachs set­tles 1MDB case with Malaysia for $3.9bn

Fiji Sun - - BUSINESS -

Gold­man Sachs has struck a $3.9bn (FJ$ 8.32bn) set­tle­ment with Malaysia over losses the south-east Asian coun­try suf­fered in a cor­rup­tion scan­dal when bil­lions of dol­lars were plun­dered from 1MDB, its state in­vest­ment fund.

Un­der the terms of the agree­ment, Gold­man will make a cash pay­ment of $2.5bn (FJ$5.33bn) to the Malaysian gov­ern­ment. The US in­vest­ment bank has also agreed to guar­an­tee that Malaysia will re­ceive at least $1.4bn (FJ$2.98bn) from the sale of seized as­sets that were ac­quired with pro­ceeds mis­ap­pro­pri­ated from 1MDB.

“This set­tle­ment rep­re­sents as­sets that right­fully be­long to the Malaysian peo­ple,” said Zafrul Aziz, Malaysia’s fi­nance min­is­ter, in a state­ment.

“We are con­fi­dent that we are se­cur­ing more money from Gold­man Sachs com­pared to pre­vi­ous at­tempts, which were far below ex­pec­ta­tions.”

The set­tle­ment marks the end of a fraught le­gal bat­tle be­tween Gold­man and Malaysia, which has sought to re­coup bil­lions of dol­lars fun­nelled out of 1MDB to buy lux­ury prop­erty, ex­pen­sive art and to fi­nance the Os­car-nom­i­nated film The Wolf of Wall Street.

The US Depart­ment of Jus­tice, which is con­duct­ing its own in­ves­ti­ga­tion into the scan­dal, al­leges a to­tal of $4.5bn (FJ9.6bn) was mis­ap­pro­pri­ated from the fund.

At the heart of the scan­dal is Jho Low, a Malaysian fi­nancier ac­cused of mas­ter­mind­ing a fraud US of­fi­cials have la­belled “klep­toc­racy at its worst”. Kuala Lumpur has filed crim­i­nal charges against Mr Low, who re­mains at large and de­nies wrong­do­ing.

The set­tle­ment marks the end of a fraught le­gal bat­tle be­tween Gold­man Sachs and Malaysia, which has sought to re­coup bil­lions of dol­lars fun­nelled out of 1MDB.

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