Goldman Sachs Tower, is the tallest building in New Jersey. August 23, 2017 in Jersey City, New Jersey (Photo by astudio from Shutterstock).

Malaysia held talks with Goldman over 1MDB charges: report

Malaysia held talks with Goldman Sachs about dropping charges against three units of the Wall Street bank that prosecutors brought over the multi-billion-dollar 1MDB scandal, a report said Thursday.

Huge sums were stolen from Malaysian state fund 1MDB in a fraud allegedly involving former leader Najib Razak and his cronies, and spent on everything from high-end real estate to a luxury super-yacht.

Goldman’s role has been under scrutiny as it helped arrange bond issues worth $6.5 billion for 1MDB, with Malaysia claiming large amounts were misappropriated in the process.

Last year, Malaysia filed charges against the units of the bank and two ex-employees over the scandal. In August, charges were filed against 17 current and former executives of three Goldman subsidiaries.

The Wall Street Titan says it will fight the charges, and that former members of the Malaysian government and 1MDB lied to the bank.

Malaysian Attorney-General Tommy Thomas told the Nikkei Asian Review that officials held two sets of discussions with the bank about dropping charges and were open to more.

“A lot of cases are even settled even after the trial begins,” he said. “So the doors for discussion are still open while the prosecution readies the criminal case.”

His office did not immediately respond to requests for comment.

There have been procedural hearings related to the case in Malaysia but a trial has not begun.

Malaysia accuses the Goldman units of giving false statements which led to $2.7 billion being misappropriated in relation to the bond issues.

The charges against the current and former executives were brought under laws that mandate that directors, chief executives and other corporate representatives in position at the time of an offence are also deemed to have committed that crime, according to officials.

Malaysia says fees earned by Goldman for the payments were far above regular market rates, and is seeking compensation of $7.5 billion from the bank over the scandal.

The US Justice Department, which is seizing assets allegedly bought with stolen 1MDB cash in America, estimates that $4.5 billion was looted from the fund.

– AFP