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Wed 28 Nov 2018 – 12:28
Injured investors feel the blood after Goldman's former partner Tim Leissner pleaded guilty to conspiring to launder money and to being the subject of a lawsuit. Other charges filed by US authorities. New revelations in The New York Times Lloyd Blankfein, then CEO, privately met Jho Low, the alleged mastermind of the scandal, alongside a Abu Dhabi fund manager, would weaken any defense that he 's sure of. act of rogue employees work.
The Abu Dhabi lawsuit adds to the growing expectations of a cumbersome deal with the US Department of Justice. Goldman could pay a fine of up to US $ 1.2 billion, plus $ 600 million in commissions and revenues generated by the bank by holding three 1MDB bonds, according to a Morgan Stanley bank analyst. Two of these bonds were jointly guaranteed by International Petroleum Investment Company, which was integrated into Mubadala, another Abu Dhabi fund.
The round of accusations is growing. The new administration of Prime Minister Mahathir Mohamad in Malaysia claims the reimbursement of the fees it has paid to Goldman, and also tries to snatch a separate settlement with Abu Dhabi, worth an estimated $ 5.8 billion US. As part of this decision, London and the MDB agreed to assume the principal and interest on the US $ 3.5 billion guaranteed bonds guaranteed by IPIC.
Goldman is now caught in the middle, as neither Abu Dhabi nor Malaysia want to be held responsible for the embarrassing pledges due in 2022. It is unclear whether Abu Dhabi's demand will hold up well as it also puts involved other people in the same lawsuit, including two Former IPIC former employees allegedly bribed by Goldman. The bank says it expects to vigorously challenge the charges.
The emirate has also tried and failed to take Wall Street before. The Abu Dhabi Investment Authority lost its case against Citigroup for its US $ 7.5 billion investment in the troubled mega-bank crisis. The overall stench around 1MDB, however, could still put several pressures on Goldman.
On November 21, a sovereign wealth fund in Abu Dhabi sued Goldman Sachs and others in a New York court to recover losses from Malaysia's sovereign wealth fund of 1MBD.
The lawsuit alleges that the US investment bank plotted to bribe two officials of the International Petroleum Investment Company and its Aabar unit. He adds that "in exchange for the bribes paid by Goldman Sachs and his co-conspirators," the officials agreed to manipulate and mislead IPIC and Aabar. Goldman said he expects to vigorously challenge this claim.
IPIC has agreed to jointly guarantee two bond issues with a total value of US $ 3.5 billion, arranged by Goldman for the Malaysian Fund in 2012. The bonds mature in 2022.
As part of an arbitration award made in London in 2017, 1MDB and the Ministry of Finance of Malaysia agreed to assume responsibility for the principal and interest of both obligations. Malaysia has now filed documents for the cancellation of this settlement with a total value of 5.8 billion US dollars.
The US Department of Justice said about 4.5 billion US dollars had been diverted from 1MDB between 2009 and 2014. Earlier in November, US prosecutors had filed criminal charges against two former Goldman bankers. One of them, Tim Leissner, pleaded guilty to conspiracy to launder money and conspiracy to violate the law on corrupt practices abroad.
REUTERS
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