Goldman’s Solomon feels ‘horrible’ about 1MDB breaches

By BLOOMBERG

New York • Goldman Sachs Group Inc CEO David Solomon said he felt “horrible” about the role former bank employees played in the scandal surrounding Malaysia’s 1Malaysia Development Bhd (1MDB) fund.

At least three Goldman bankers were implicated by the US Department of Justice in a multiyear criminal enterprise that included bribing officials in Malaysia and elsewhere, and laundering hundreds of millions of dollars. In one of his first major headaches as CEO, Solomon will have to wrestle with the fallout from the firm’s growing entanglement in the high-profile corruption probe.

“It is obviously very distressing to see two former Goldman employees went so blatantly around our policies and so blatantly broke the law,” Solomon said in a Bloomberg TV interview yesterday at the New Economy Forum in Singapore. “We take the matter extremely seriously and we continue to work with the authorities as they investigate it.”

Goldman has been under scrutiny for years for its role in raising US$6.5 billion (RM27.3 billion) for 1MDB — and for the nearly US$600 million in fees it earned from the bonds. 1MDB is at the centre of a global scandal involving claims of embezzlement and money laundering, which have triggered investigations in the US, Singapore, Switzerland and beyond.

Court documents unsealed last Thursday said an unidentified Goldman official in Asia conspired with former Goldman bankers Tim Leissner, Roger Ng and Malaysian financier Low Taek Jho, and had knowledge that bribes were being paid. — Bloomberg