The Malaysian government is channelling all of its efforts into seeking reparations as a result of the financial damage caused by the scandal-ridden state fund 1Malaysia Development Berhad (1MDB) during the previous administration, said Finance Minister Lim Guan Eng.
In an exclusive interview with with CNN news anchor Kristie Lu Stout on News Stream during an official visit to Hong Kong on Monday (14 Jan), Mr Lim revealed that international investment banking firm Goldman Sachs and two of its former bankers “are going to declare their annual earnings next month”, following criminal charges levied against them by the Malaysian government last year.
“We hope they make the necessary provisions for reparations to Malaysia. We feel that GS have to bear responsibility,” he said, adding that should Goldman fail to do so, Malaysia will seek recourse through the law.
“This has been initiated and carried out by my Attorney General,” Mr Lim highlighted.
When probed on the amount of reparations being sought by the Malaysian government, Mr Lim said: “$7.5 billion US dollars. That’s what we are seeking.”
He added that it is “a very reasonable amount,” as “$6.5B [was] raised through the 1 issuance,” and “we don’t know what happened to the money”.
“The fees were paid for services that were not duly rendered,” added Mr Lim.
He highlighted that the payment made for services that were not even fulfilled constituted a “breach of fiduciary duty”.
“The fact that they brokered the deal that was 100 basis points higher than the market rate, that does not make sense. I think many people can do that without paying you $600 million USD,” said Mr Lim.
When asked as to how he would prove that Goldman itself had contributed to the financial mess, as opposed to the actions of a few “rogue” bankers, the Finance Minister replied: “The fact that the senior executive who has plead guilty, who has pleaded guilty, has full access to the former CEO, and I think the evidence will clearly show that Goldman Sachs was in the know.”
“How can you disclaim responsibility when you collected such a huge amount of fees? … At the same time, you were of course broadcasting the fact that you were representing Malaysia. I don’t think they can run away so easily,” he added.
Mr Lim expressed his hope that Malaysians will be proud of their nation again, knowing that “Malaysia is no longer a global kleptocracy.”
“Yes. I want to be a normal, boring democracy where there are no financial scandals. No more 1MDB. No more Jho Low. And of course, no more former PM [Najib Razak],” he said.
