May 14, 2021

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Goldman Sachs and Malaysia reach a settlement agreement over 1MDB scandal, sources say

Logo of 1MDB (1Malaysia Development Berhad) on a bus window in Kuala Lumpur, Malaysia, taken on February 17, 2017.

Chris Jung | NurPhoto | Getty Images

Malaysia on Friday said U.S. investment bank Goldman Sachs has agreed to a $3.9 billion settlement with the government over the multibillion-dollar 1MDB scandal.

The deal includes a $2.5 billion cash payout by Goldman and a guarantee by the bank to return at least $1.4 billion in assets linked to 1MDB bonds, Malaysia’s finance ministry said in a statement.

Malaysian prosecutors filed charges in December 2018 against three Goldman Sachs units for misleading investors over bond sales totalling $6.5 billion that the bank helped raise for sovereign wealth fund 1MDB (1Malaysia Development Bhd).

Goldman Sachs has consistently denied wrongdoing, saying that certain members of the former Malaysian government and 1MDB lied to it about how proceeds from the bond sales would be used.

The units of Goldman Sachs have pleaded not guilty to the charges.

The U.S. Department of Justice has said around $4.5 billion was misappropriated from 1MDB.

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