Goldman Sachs agrees to pay more than $ 2.9 billion to resolve polls in 1MDB scandal

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Goldman Sachs has agreed to pay more than $ 2.9 billion to regulators around the world, including a record penalty for violating a U.S. anti-corruption law, in order to resolve investigations into its role in an international financial scandal.The sum, which comes on top of the $ 2.5 billion the bank agreed to pay the Malaysian government earlier this year, includes individual deals with regulators in the US, UK, Singapore and elsewhere. , according to a statement released Thursday by the US department. of Justice.

The bank’s parent company has entered into a deferred prosecution agreement with the Justice Department that should allow it to avoid having to quit certain business activities. Earlier Thursday, the bank’s Malaysian subsidiary officially pleaded guilty to its role in the 1MDB debacle, admitting to one count of conspiracy to violate the Foreign Corrupt Practices Act.

“Goldman Sachs has today accepted responsibility for its role in a conspiracy to bribe senior foreign officials for lucrative underwriting and other 1MDB related business,” Acting Deputy Attorney General Brian C said. Rabbitt of the Criminal Division of the Department of Justice in a statement. The ad “forces Goldman Sachs to admit wrongdoing and pay nearly $ 3 billion in penalties, fines and restitution, holds the bank accountable for this criminal scheme.”

The deal resolves an issue that has weighed on CEO David Solomon since taking over from his predecessor Lloyd Blankfein two years ago. Goldman has been accused of helping a corrupt Malaysian financier steal billions of dollars from the $ 1MDB $ 6.5 billion development fund, money that was supposed to help build the country’s economy.

Instead, 1MDB funds were reportedly used by Malaysian financier Low Taek Jho to fund an epic spending spree, including a $ 250 million yacht, a stake in Martin Scorsese’s film “The Wolf of Wall.” Street ‘and properties around the world. At least $ 1 billion of those funds were used to bribe Malaysian and Abu Dhabi officials, U.S. officials said Thursday.

Goldman bankers reaped around $ 600 million in fees to facilitate bond trades in 2012 and 2013 that funded 1MDB, an amount fixed income professionals deemed unusually high.

An agreement with US agencies had been expected since early 2020, but negotiations reportedly dragged on as the bank sought to avoid having to plead guilty in the case.

In July, Goldman announced a $ 3.9 billion settlement with the Malaysian government to settle a criminal investigation into the bank’s role in the episode. This included a cash payment of $ 2.5 billion and the bank’s guarantee that Malaysia will receive at least $ 1.4 billion in proceeds from the seized assets.

This story is developing. Please come back for updates.

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