Goldman Sachs agrees to pay over $2 billion to the US Justice Department over Malaysia's 1MDB scandal, report says

Brendan McDermid/Reuters

  • Goldman Sachs has reached a deal with the US Department of Justice to pay over $2 billion for its involvement in the 1MDB scandal, Bloomberg reported.
  • The settlement, which would avoid a US criminal conviction, could be announced within days, the news agency said, citing sources.
  • The latest deal follows a $2.5 billion settlement related to a probe with Malaysia in July. 
  • The firm may shell out $5 billion overall when settlements with Malaysia, the US Department of Justice, and other agencies are tallied.
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Goldman Sachs has agreed to pay over $2 billion to the US Justice Department over its involvement in Malaysia’s 1MDB scandal, which quickly became one of the biggest financial scandals in history, Bloomberg reported.

The settlement could be announced within the coming days before the US election, Bloomberg said, citing sources.

Goldman Sachs and the Justice Department did not immediately respond to Business Insider requests for comment.

The US bank’s payment is said to be broadly in line with analyst estimates, and would help avoid a US criminal conviction. It would also do away with the cloud of doubt surrounding the scandal after years of investigation with the Justice Department over its fundraising for the 1MDB investment fund.

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Goldman Sachs may shell out $5 billion overall when settlements with Malaysia, the US Department of Justice, and other agencies are worked out, Bloomberg said.

Singaporean authorities are said to issue a financial penalty and a conditional warning against the firm. If ignored, it could result in prosecution for Goldman Singapore.

The 1MDB scandal centers on 1 Malaysia Development Berhad, a sovereign-wealth fund that raised about $12 billion, much of which was said to be embezzled or laundered.

The scandal is linked to everything right from the “Wolf of Wall Street” film to the supermodel Miranda Kerr to President Donald Trump. It even helped lead to the ouster of Malaysian Prime Minister Najib Razak in 2018.

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