1MDB: Goldman Sachs hauls Malaysia to UK court

Goldman Sachs Group has filed legal action against Malaysia in a United Kingdom (UK) court in relation to the settlement agreement linked to the bank’s role in the 1MDB affair.

Reuters today quoted a source stating that the arbitration action was filed at the London Court of International Arbitration.

“Today (yesterday), we filed for arbitration against the government of Malaysia for violating its obligations to appropriately credit assets against the guarantee provided by Goldman Sachs in our settlement agreement and to recover other assets,” a spokesperson reportedly said.

Reuters' report also stated that the Anwar Ibrahim-led government and the Attorney-General's Chambers did not immediately respond to a request for comment.

Malaysiakini has reached out to the AGC for a response on the matter.

Previously, it was reported that Anwar threatened to haul Goldman to court.

Both sides were embroiled in a dispute over a 2020 settlement agreement, whereby the bank had agreed to pay US$3.9 billion (RM18.41 billion) to settle Malaysia’s criminal investigation over its role in the affair.

In a regulatory filing earlier this year, Goldman said it was also required to make a one-time interim payment of US$250 million if the Malaysian government had not received at least US$500 million in assets and proceeds by August last year.

The bank said the two parties are tussling over whether Malaysia recovered at least US$500 million as of August 2022 and whether any interim payment was due.

Malaysian and United States (US) authorities estimated US$4.5 billion was embezzled from Malaysia’s sovereign wealth fund 1MDB in an elaborate global scheme that implicated high-level officials in the fund.

It was reported that prosecutors have said Goldman helped 1MDB raise US$6.5 billion through bond sales and earned US$600 million in fees.

The US has been returning funds it has recovered from seized assets that were allegedly bought with 1MDB money.