Bank scandal: apology alone is insufficient

THE apology from the chief executive of Goldman Sachs for its role in the sprawling 1Malaysia Development Berhad (1MDB) corruption scandal was insufficient, the Malaysian finance minister said yesterday as he called for the company to compensate Malaysia.

“An apology is not enough, but an apology with $7.5 billion (R103.4bn), that’s what matters,” said the minister, Lim Guan Eng, at a press conference carried by state news agency Bernama.

“Only when you pay reparation and compensation, that will be sufficient,” he added.

It was unclear where the minister got the figure from.

The 1MDB state fund is the subject of an international investigation involving multiple countries over suspicions $4.5bn had been misappropriated by high-ranking Malaysian officials between 2009 and 2014.

The minister’s response comes a day after Sachs chief executive David Solomon issued a public apology to the people of Malaysia for the role one of the investment bank’s former partners, Tim Leissner, played in the beleaguered fund.

Goldman Sachs was entrusted with arranging and underwriting three 1MDB bonds with a total face value of $6.5bn. The Malaysian government charged the bank with theft last month, alleging its employees had profited from part of the misappropriated bond proceeds and underwriting and arranging fees of $600 million.

“It’s very clear that the people of Malaysia were defrauded by many individuals, including the highest members of the prior (Malaysian) government,” Soloman said.

“For Leissner’s role in that fraud, we apologise to the Malaysian people.”

Solomon distanced the bank from Leissner’s actions, insisting that

|“considerable due diligence” had been carried out before each transaction.

| dpa African News Agency (ANA)