US investment bank Goldman Sachs has reached a $ 3.9 billion settlement with the Malaysian government over the multi-million dollar 1MDB scandal, both sides said on Friday.
The deal includes a $ 2.5 billion cash payment by Goldman and a bank guarantee to return at least $ 1.4 billion in assets linked to 1MDB bonds, the Malaysian finance ministry said in a statement.
“We are confident that we are securing more money from Goldman Sachs compared to previous attempts, which were far below expectations,” Finance Minister Tengku Zafrul Aziz said in a statement.
“We are also pleased to be able to resolve this outside of the court system, which would have cost a lot of time, money and resources,” he said, adding that the settlement would resolve all pending charges and claims against Goldman Sachs.
Malaysian prosecutors filed charges in December 2018 against three Goldman Sachs units for misleading investors into the sale of bonds totaling $ 6.5 billion that the bank helped raise for the sovereign wealth fund 1MDB (1Malaysia Development Bhd).
Goldman Sachs has always denied the allegations, saying that members of the former Malaysian government and 1MDB lied to it about how the proceeds from bond sales would be used. Goldman Sachs units pleaded not guilty to the charges.
Goldman Sachs confirmed the $ 3.9 billion settlement and said it had reached an agreement in principle with Malaysia to resolve all criminal and regulatory procedures in the country involving the company.
Authorities in the US and Malaysia say about $ 4.5 billion of 1MDB was stolen, in an elaborate scheme that spanned the globe and involved former Malaysian Prime Minister Najib Razak and Goldman Sachs, among others.
A Malaysian court will issue its verdict in the case against Najib on Tuesday, the first of several corruption trials it faces linked to the 1MDB scandal.
Najib denied wrongdoing and pleaded not guilty to all charges against him.
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