Friday 4 September 2020 3:14 pm

Malaysia drops charges against Goldman Sachs over 1MDB scandal

Malaysian prosecutors today dropped criminal charges against three Goldman Sachs units accused of misleading investors over $6.5bn (£4.9bn) in bond sales they helped organise for scandal-hit state fund 1MDB.

The move comes after Goldman Sachs agreed to pay $3.9bn to Malaysia to settle a probe into its alleged role in the scandal involving the fund, which counts former Malaysian prime minister Najib Razak as one of its co-founders.

Read more: Goldman Sachs reaches $3.9bn settlement with Malaysia over 1MDB scandal

The US Department of Justice estimates $4.5bn was misappropriated from 1MDB between 2009 and 2014, including some of the funds that Goldman Sachs helped raise.

The units – based in London, Hong Kong and Singapore – had pleaded not guilty in February and the bank has consistently denied wrongdoing.

“Goldman Sachs International Ltd, Goldman Sachs (Asia) LLC and Goldman Sachs (Singapore) are therefore discharged amounting to an acquittal from all four charges made against them,” state news agency Bernama quoted High Court judge Mohamed Zaini Mazlan as saying as he granted prosecutors the request.

As part of its deal with Malaysia, Goldman has paid $2.5bn in cash and guaranteed the return of $1.4bn in 1MDB assets seized around the world.

Read more: Goldman Sachs partner caught up in 1MDB scandal barred from banking industry

At least six countries including Switzerland and Singapore have opened money laundering and corruption probes into 1MDB in a scandal that implicated Najib and high-level officials of the fund.

In July, Najib was found guilty of corruption and sentenced to 12 years in prison in the first of several trials he faces over 1MDB. Najib has maintained that he is innocent.

Goldman Sachs was contacted for comment.

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