KUALA LUMPUR, July 20 — A six-member team of executives and legal counsel from US banking giant Goldman Sachs arrived in Malaysia on Saturday to meet Malaysian authorities, Singapore’s Straits Times reported.
The report said the team is in the final stages of sorting out a settlement deal from Goldman Sachs for money embezzled through Malaysia’s former sovereign fund 1Malaysia Development Berhad (1MDB).
The top American executives obtained special travel passes and visas to enter Malaysia for these negotiations and will meet Attorney General Tan Sri Idrus Harun, who heads the recovery team for Malaysia, the report said.
Idrus will reportedly be assisted by Solicitor General II Datuk Siti Zainab Omar.
“The prospects of getting a settlement are strong after both sides agreed on key parametres in recent weeks that are needed to move forward,” said an anonymous Malaysian government official close to the situation.
The article also quoted a senior US-based financial executive assisting the Malaysian government saying the Goldman Sachs team would not travel to Malaysia if they felt a deal was not within reach.
On July 9, Finance Minister Tengku Datuk Seri Zafrul Aziz said Malaysia is still seeking compensation from Goldman Sachs in the range of US$2 billion (RM8.5 billion) to US$7.5 billion (RM32 billion) as settlement over the latter’s role in the 1MDB scandal.
He has said in the past that Malaysia would only look to settle provided the number is ‘fair’.
Thus far, Malaysia has only recovered just over US$200 million (RM853 million) from the United States Department of Justice (DOJ) and another US$150 million (RM640 million) from the sale proceeds of seized assets, such as the superyacht Equanimity.
However, the article said lawyers and financial executives close to the situation felt Malaysia’s chances of asset recovery are better now under prime minister Tan Sri Muhyiddin Yassin’s stewardship as he has adopted a more pragmatic approach, with the simple aim of securing the best deal possible in the multi-layered negotiations.
Under Pakatan Harapan’s rule, then prime minister Tun Dr Mahathir Mohamad was looking to recoup more money from the 1MDB scandal and felt the initial US$2 billion (RM8.5 billion) was too low.
However there was never any guarantee the country would be able to recoup all the money as fugitive financier Low Taek Jho was still at large and most of the embezzled money led back to him.
With the DOJ pushing ahead with negotiations to reach a full resolution over the civil forfeiture suits and the ongoing criminal indictments that began in mid-2016, Muhyiddin was advised by his legal team that there was no guarantee they would win the legal battles.
“The main concern was that should this (the Muhyiddin) government fall, any agreement could be reneged. With Malaysia in the global settlement, there is added insurance for Goldman Sachs,” said the US-based financial executive close to the ongoing talks.
US authorities say about US$4.5 billion (RM19 billion) was siphoned from 1MDB, founded in 2009 by then Malaysian prime minister Datuk Seri Najib Razak.
The Malaysian government had previously in December 2018 filed charges against Goldman Sachs’ three subsidiaries Goldman Sachs International Ltd, Goldman Sachs (Asia) LLC and Goldman Sachs (Singapore) over alleged involvement in a scheme to defraud the Malaysian government and investors in bond sales worth US$6.5 billion (RM28 billion) with false and misleading statements given during the fund-raising exercise for 1MDB, with the scheme alleged to have been set up in conspiracy with other individuals such as fugitive businessman Low.
