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NEW YORK: Global financial titan Goldman Sachs agreed to pay $ 2.9 billion in fines to settle criminal charges in the 1MDB bribery scandal in Malaysia, the largest U.S. fine in a corruption case, the Justice Department announced on Thursday (Friday in Manila).
Acting Assistant Attorney General Brian C Rabbitt said Goldman “accepted responsibility” in the case involving $ 1.6 billion in bribes, the largest ever recorded, and massive profits laundered through the US financial system.
Goldman Sachs helped raise $ 6.5 billion for the Malaysian government’s sovereign wealth fund. The US Department of Justice has said that high-level fund officials and their associates stole more than $ 4.5 billion from 1MDB between 2009 and 2015.
The investment fund “was looted by corrupt officials and their co-conspirators, including senior Goldman bankers,” turning it “into a piggy bank for corrupt public officials and their cronies,” Rabbitt told a news conference.
For the first time for Goldman Sachs, the company’s Malaysian unit pleaded guilty in a US court.
Thursday for violations of US anti-bribery law as part of an agreement to end the criminal investigation in the large case involving authorities from nine countries.
The guilty plea could restrict the activities of Goldman Sachs Malaysia, but allows the parent company to avoid admitting wrongdoing in court, which would have damaged its ability to do business.
The parent company has pleaded not guilty in a US court and has agreed to a “deferred prosecution” for three and a half years, during which time the company will face increased scrutiny from regulators.
But Rabbitt stressed that despite the deal, the company has been indicted in the bribery scandal, “for which there has been a significant amount of criminal liability” for Goldman and “imposes significant consequences” in the cases.
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