Monday, January 18, 2021

Justice Department wants Goldman Sachs to plead guilty in bribery scandal


Justice Department prosecutors are reportedly pushing for a hardball approach to negotiations with Goldman Sachs over its role in a $3 billion Malaysian bribery scandal that has hung over the bank for years.

Career prosecutors at the Justice Department want the negotiating team to insist that the bank agrees to a guilty plea, along with any other additional fines and penalties stemming from its role in allegedly defrauding 1Malaysia Development Berhad, the Asian country’s sovereign wealth fund, according to a report in the Financial Times.

In 2012 and 2013, Goldman sold more than $6 billion in bonds to help fund 1MDB, which was then secretly being run by financier Jho Low. About half of that money was then spent by Low to enrich himself and throw lavish parties attended by celebrities like Leonardo DiCaprio.

The revelations about the internal government deliberations signal that the 1MDB investigation could be nearing the final stages. A Goldman insider said that the bank hasn’t recently had discussions with the government over final settlement.

It wasn’t clear what charge the government wants Goldman to plead guilty to.

Justice Department spokesman Peter Carr declined to comment.

Goldman has previously pinned the blame on two of its bankers, including former partner Tim Leissner, who pleaded guilty to aiding the fraud last year.

“We do not believe that such a charge would be warranted by the facts of the case or the law, particularly because senior management was unaware of the criminal activity by Mr Leissner and his associate who took extraordinary efforts to hide their part in the illegal scheme from management, compliance, and legal functions at the firm,” Jake Siewert, a spokesman for the bank, said in a statement.


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