August 23, 2020

Global investment banking firm announces settlement in 1MDB case

On August 18, 2020, Goldman Sachs Group, Inc. announced in a regulatory filing that it had entered a settlement with the government of Malaysia and 1Malaysia Development Berhad (1MDB), resolving all criminal and regulatory proceedings against the group in Malaysia related to 1MDB, including all pending proceedings against subsidiaries of Goldman Sachs and certain former and current directors.  Under the agreement, Goldman Sachs will pay $2.5 billion to the Malaysian Government, and guarantee an additional $1.4 billion in proceeds from 1MDB-related assets seized by governments around the world.   

The settlement stems from allegations by the government of Malaysia that certain Goldman Sachs units misled investors about bond sales intended to benefit the country’s sovereign wealth fund, 1MDB.  The fund and the officials and businessmen who managed it have been the focus of several investigations in Malaysia, the United States, and elsewhere.  The US has successfully pursued forfeiture claims (here and here) against properties associated with the 1MDB scandal, and has returned hundreds of millions of dollars in forfeited assets to Malaysia. In addition, several individuals have been indicted for their roles in helping to funnel billions of dollars away from the fund.

Form 8-K (August 2020) | Form 8-K (July 2020)