- Malaysia’s finance minister lashes out at Goldman Sachs in an interview with the New York Times
- “We have suffered extremely large losses,” Lim Guan Eng tells the newspaper. “And don’t tell me you don’t know where the money went.”
- The scandal is likely to be a focus for investors this week when the bank reportfourth-quarterer earnings
A senior Malaysian official lashed out against Goldman Sachs for its role in the1MDB Malaysian sovereign-wealth fund scandal, casting doubt on the bank’s claim that the blame lies with a few rogue employees.
“We have suffered extremely large losses, and you were the financial adviser,” Lim Guan Eng, the finance minister of Malaysia, referring to Goldman Sachs in an interview with the New York Times on Monday.
“Now how do you account for that? And don’t tell me you don’t know where the money went,” Mr. Lim said in the interview. “Goldman Sachs needs to come to terms with the facts.”
The 1Malaysia Development Berhad fund, or 1MDB,is at the center of one of the biggest financial scandals in history, as it is the subject of corruption and money-laundering investigations in at least six countries.
Goldman earned roughly $US600 million in fees for raising $US6.5 billion for the fund.
In December, Malaysia filed criminal charges against Goldman Sachs, saying that $US2.7 billion of the proceeds of three 1MDB bonds was misappropriated and that it was seeking “well in excess” of that amount in fines.
Malaysia also filed charges against two former Goldman partners for their role in the scandal.
The 1MDB saga has dealt another blow to Goldman’s reputation, which the firm has worked hard to restore since the 2008 subprime-mortgage crisis.
The scandal, and any talk of potential fines, is likely to be a focus for investors on January 16, when David Solomon, Goldman Sachs’s recently appointed CEO, announces fourth quarter earnings.
In a statement, Goldman said it will “vigorously defend” itself against any charges, and accused former government officials of lying to the bank. The bank’s full statement can be seen below:
Business Insider Emails & Alerts
Site highlights each day to your inbox.