Goldman Sachs apologises to Malaysia over multi-billion dollar scandal
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Goldman Sachs apologises to Malaysia over multi-billion dollar scandal

GOLDMAN SACHS has issued an apology to the Malaysian people for one of its former banker’s role in the 1Malaysia Development Berhad (1MDB) sovereign state fund scandal.

The banks Chief Executive Officer David Solomon, however, said the bank had conducted due diligence before every transaction which amounted to billions of dollars.

Malaysian authorities and the US Department of Justice have launched investigations against the bank for its roles as underwriter and arranger of three bond sales that raised US$6.5 billion for 1MDB.

SEE ALSO: Goldman Sachs ‘cheated’ Malaysia on 1MDB, says PM 

Last year, US prosecutors charged two former Goldman bankers over the alleged theft of billions of dollars from 1MDB.

One of the ex-bankers, Tim Leissner, was a former partner for Goldman Sachs in Asia who pleaded guilty to conspiracy to launder money and violate the Foreign Corrupt Practices Act.

“It’s very clear that the people of Malaysia were defrauded by many individuals, including the highest members of the prior government,” Solomon said on conference call discussing the bank’s fourth-quarter results, as quoted by Reuters.

The CEO said Leissner denied the involvement of any of Goldman’s intermediaries in transactions with the state fund.

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Goldman Sachs CEO David Solomon and Executive Director, Fortune MPW Summits and Live Content, Pattie Sellers speak onstage at Fortune Most Powerful Women Summit – Day 2 on Oct 10, 2017 in Washington, DC. Source: AFP

US authorities have also charged former Goldman banker Roger Ng, who was arrested in Malaysia in is awating extradition to the US.

The 1MDB scandal saw an eye-watering US4.5 billion being swindled by high-level officials and bankers between 2009 and 2014.

Soloman said Goldman has sought and received written assurances from 1MDB and International Petroleum Investment Co (IPIC) that no third-parties were involved in the transactions.

SEE ALSO: Goldman shares drop as Malaysia files criminal charges over scandal 

Abu Dhabi’s IPIC had co-guaranteed the 1MDB bonds when they were issued in 2012, according to Reuters.

He said in the final offering, the Malaysian government and 1MDB represented that no intermediaries were involved.

“All these representations to Goldman Sachs have proven to be false,” Solomon said.

In November, Malaysian Prime Minister Dr Mahathir Mohamad said bankers at Goldman Sachs Group Inc “cheated” the country throughout its dealings with the government under former Prime Minister Najib Razak.

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