- Whopping 1 lakh jobs on the cards in aviation and aeronautical manufacturing sector by 2024, says Minister
- Money Guru: 10 funds for financial independence, this 15th August - details
- India's forex reserves jump 60x since 1990s, surge 335 times since Independence | Check this data
- India@100: Anil Singhvi predicts Nifty will reach 1,75,000 in next 25 years - Here's why
Goldman Sachs CEO apologises for ex-banker's role in 1MDB scandal
Goldman Sachs Group Inc Chief Executive Officer David Solomon on Wednesday apologised to the Malaysian people for former banker Tim Leissner`s role in the sovereign wealth fund 1MDB scandal, but said the bank had conducted due diligence before every transaction.
Goldman is being investigated by Malaysian authorities and the U.S. Department of Justice for its role as underwriter and arranger of three bond sales that raised $6.5 billion for 1Malaysia Development Berhad.
U.S prosecutors last year charged two former Goldman bankers for the theft of billions of dollars from 1Malaysia Development Berhad. Leissner, a former partner for Goldman Sachs in Asia, pleaded guilty to conspiracy to launder money and violate the Foreign Corrupt Practices Act.
"It`s very clear that the people of Malaysia were defrauded by many individuals, including the highest members of the prior government," Solomon said on conference call discussing the bank`s fourth-quarter results.
Solomon said that Leissner denied the involvement of any of Goldman`s intermediaries in transactions with 1MDB.
An attorney representing Leissner did not immediately respond to a request for comment.
Roger Ng, the other charged former Goldman banker, was arrested in Malaysia at the request of U.S. authorities and is expected to be extradited, according to John Marzulli, a spokesman for the prosecution.
The DOJ has said that $4.5 billion was misappropriated by high-level officials of the fund and their associates between 2009 and 2014.
As part of Goldman`s due diligence efforts, Solomon said the bank sought and received written assurances from 1MDB and International Petroleum Investment Co (IPIC) that no third-parties were involved in the first two bond sales.
Abu Dhabi`s IPIC had co-guaranteed the 1MDB bonds when they were issued in 2012.
In the final offering, the Malaysian government itself, along with 1MDB, represented that no intermediaries were involved, he said.
"All these representations to Goldman Sachs have proven to be false," Solomon said.
Goldman Sachs did not disclose any other information about its involvement with 1MDB, but said the impact on its client franchise had been "de minimis."
Shares of the bank, which reported strong fourth-quarter results earlier in the day, have fallen over 25 percent in the last three months, after headlines about its involvement with the sovereign wealth fund emerged.
The Malaysian government said in December it was seeking up to $7.5 billion in reparations from Goldman over its dealings with 1MDB.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.