US might fine Goldman up to US$2b over 1MDB

Financial giant Goldman Sachs Group Incorporated might end up between US$1.5 billion (RM6.24 billion) and US$2 billion (RM8.32 b) to the US Department of Justice (DOJ), over its role in the 1MDB affair.

According to Bloomberg, the DOJ and other federal agencies were still deciding on the penalties which resulted from criminal and regulatory probes into the company.

Goldman Sachs had reportedly pocketed some US$600 million (about RM2.5) from arranging the bonds related to 1MDB.

Quoting three people that it said were familiar with the negotiations, Bloomberg stated that a settlement could be announced as soon as next month and that the bulk of the penalties would be paid to the US Justice Department.

"That’s less than what some analysts have signalled Goldman might have to pay. While a settlement could be announced as soon as next month, the terms could change before a deal is finalized, said the people who asked not to be named in discussing private negotiations," said the news report.

Its attempt to seek official comments from the authorities, however, were not successful, as spokespersons for Justice Department and the Federal Reserve and Securities and Exchange Commission have declined to comment. The latter has been pursuing civil investigations into Goldman Sachs.

The bank meanwhile had reiterated that it continues to cooperate with authorities.

Previously, the company had offered to enter a settlement agreement with Malaysia but this was turned down by Prime Minister Dr Mahathir Mohamad, who said that Goldman Sachs was offering only US$1b as compensation.

Mahathir described the offer as "peanuts" and "not adequate".

The government of Malaysia has filed criminal charges against three subsidiaries of Goldman Sachs Inc over their handling of the bonds issued by 1MDB.