Goldman Sachs has agreed with the Department of Justice to pay over $2 billion for the bank's role in Malaysia's multi-billion dollar scandal at state fund 1MDB, Bloomberg first reported.
Why it matters: The settlement, expected to be announced within days, would allow Goldman Sachs to avoid a criminal conviction in the U.S. over the bribery and money laundering scandal that saw three of its former bankers banned for life from the banking industry by the Federal Reserve Board.
- Per the Financial Times, An Asian subsidiary of Goldman Sachs "has agreed to plead guilty" to U.S. charges "as part of a global regulatory settlement that includes more than $2bn in new penalties," expected to be announced this week.
Context: Per Axios' Felix Salmon, the bank facilitated the 1MDB fraud, earning almost $600 million in fees on three bond deals from the deeply corrupt Malaysian fund. Each time, as soon as Goldman provided the money to 1MDB, Jho Low, a former financier to ex-Prime Minister Rajib Najib, would steal it.
- The bank has always denied wrongdoing and blamed its former rogue workers.
Of note: The bank agreed in July to a $3.9 billion settlement — including $2.5 billion in cash — in exchange for charges being dropped over its role in raising funds for 1MDB Najib.
- Najib was sentenced to 12 years in prison after being found guilty of all seven corruption charges against him over the 1MDB case.
- The DOJ did not immediately respond to Axios' request for comment and a spokesperson for Goldman said in an emailed statement Tuesday, "We're not at a point we can comment or help at the present time."