Goldman Sachs pays Malaysia RM10.4bil over 1MDB scandal
Goldman Sachs Group Inc has made the US$2.5bil (RM10.4bil) payment it pledged to the Malaysian government to settle allegations of misconduct related to 1MDB, and the funds will be used to repay outstanding debt of the disgraced sovereign wealth fund, according to a person familiar with the matter.
The government received the funds in its escrow account on Thursday (Aug 27), according to the person, who asked not to be named as the information is private.
Malaysia plans to use the money to help repay 1MDB’s outstanding debt, including US$3.5bil (RM14.6bil) of bonds due in 2022 and 2023, which are now held under the Finance Ministry, the person added.
Representatives for Malaysia’s Finance Ministry and Goldman Sachs didn’t immediately respond to requests for comment.
The payment is part of an agreement Goldman Sachs reached with Malaysia to pay US$2.5bil (RM10.4bil) in cash and guarantee the return of US$1.4bil (RM5.8bil) from 1MDB assets seized around the world.
In return, Malaysia will drop criminal charges against the US bank, allowing it to start moving beyond one of its worst scandals since the financial crisis.
The money comes at an opportune time for Malaysia, which is seeking funding to shore up an economy battered by the pandemic.
The government is set to boost its debt limit for the first time since 2009 to help fund its US$70bil (RM292bil) of stimulus measures.
Goldman Sachs will have a case management hearing over its criminal charges at a Malaysian court on Sept 4, a date that was set before the July deal was struck. – Bloomberg
