KUALA LUMPUR, Oct 23 ― After repeatedly demanding Goldman Sachs pay a penalty of US$7.5 billion (RM31.4 billion) for its role in the 1Malaysia Development Berhad (1MDB) fiasco, Malaysia may now settle for less.
International business wire Bloomberg today reported a Malaysian team including Tun Daim Zainuddin are currently in negotiation talks that may see the government receive a sum between US$2 billion and US$3 billion as settlement.
According to the report, Prime Minister Tun Dr Mahathir Mohamad is keen for a settlement to be reached this year to show progress on his pledge to recoup the billions of ringgit plundered from the sovereign investment fund.
“He’s dispatched Daim Zainuddin, a confidant outside his cabinet, to serve as a top dealmaker," said Bloomberg in its report.
“A sizable settlement would help cement the country’s fiscal footing, which Mahathir has cited as a reason he’s delayed handing over power to his former protege, Anwar Ibrahim,” it said.
The Bloomberg report was unclear if the Attorney-General will be dropping its criminal charges against the US investment bank, or 17 current and former Goldman executives who have been charged individually.
Prosecutors submitted an application to move their criminal case against Goldman to the High Court yesterday.
The application was filed last Friday and the court has fixed a mention date on October 31.
In suing Goldman, the government claims the US bank misled investors by making untrue statements and omitting key facts in relation to 1MDB-related bond issues, which it had prepared.
The Malaysian government led by Pakatan Harapan has demanded reparation payments from Goldman, saying US$7.5 billion was a “reasonable” amount given that the investment bank reaped US$600 million from helping 1MDB raise US$6.5 billion in 2012 and 2013, much of which later went missing.
Earlier this year, Goldman offered RM1 billion as compensation, which Dr Mahathir described as “peanuts.”
US prosecutors are also expected to extract a serious penalty from the investment bank for its role in funding 1MDB.
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