Cover Story

Will PM come clean on why the 1MDB settlement with Goldman Sachs fell short of USD 5 billion?

Press Statement by DAP Secretary-General and Member of Parliament for Bagan, Lim Guan Eng in Kuala Lumpur on 6 August 2020.

Even Goldman Sachs Concedes That USD 2.5 Billion Will Be Paid To The Malaysian Government To Resolve Their Criminal Involvement To Defraud 1MDB Together With Malaysian Leaders And Their Cronies.

The PN federal government’s loud silence to fierce criticism of their so-called “good deal” for the USD 3.9 billion settlement with Goldman Sachs group (GS) to resolve GS’ criminal involvement to defraud 1MDB together with Malaysian leaders and their cronies, demonstrates PN’s complete lack of public accountability and transparency on a matter of public interest and importance.

The critical point that GS paid USD 2.5 billion and not USD3.9 billion was even admitted by GS. Goldman Sachs Group (GS) press announcement on the Agreement with the Government of Malaysia dated 24 July 2020 confirms that it is GS and not the Malaysian government that secured a good deal in paying USD 2.5 billion to resolve all the criminal and regulatory proceedings in Malaysia against GS. Not only will criminal charges against 17 of their current and former directors be dropped, no further charges would be brought against Goldman Sachs, its subsidiaries, or any of their directors, officers and employees (excluding former employees Tim Leissner and Roger Ng) related to 1MDB.

GS said,

The agreement in principle would involve the payment to the Government of Malaysia of $2.5 billion and a guarantee that the Government of Malaysia receives at least $1.4 billion in proceeds from assets related to 1MDB seized by governmental authorities around the world. In connection with the guarantee, Goldman Sachs performed valuation analysis on the relevant assets and believes based on that analysis that the guarantee does not present a significant risk exposure to the firm.”

GS press statement on the 1MDB settlement with the Malaysian government

In other words GS is asserting that its USD1.4 billion guarantee that Malaysia would receive from assets related to 1MDB seized by government authorities throughout the world will not likely cause GS to make any significant payments. GS exposure is likely limited to the USD2.5 billion cash payment committed by GS.

This only serves to confirm former Attorney-General Tan Sri Tommy Thomas response to this so-called “good deal” with GS on 3 August 2020,

“…the misleading statement about the US$1.4 billion (RM5.97 billion) as part of the Goldman Sachs settlement. Malaysia would have received this sum from the US Department of Justice, in any event, independent of this settlement with Goldman. This was because of the good relationship that Malaysia has established with the DOJ after the Harapan government took office in May 2018. In other words, Malaysia’s right to receive the US$1.4 billion was not in any way dependent on the Goldman Sachs settlement.”

Clearly GS secured a good deal at the expense of the Malaysian public in resolving their involvement in the 1MDB scandal for only USD 2.5 billion, one third of the USD 7.5 billion claimed by the then PH Federal government.

Will the Prime Minister Tan Sri Muhyiddin come clean on why they fell short of USD 5 billion and explain the facts fully to Malaysians?

Lim Guan Eng,
DAP Secretary-General,
Member of Parliament for Bagan.

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