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Al JazeeraJun 04, 2023
Goldman Sachs Sues Malaysia Over 1MDB Settlement
Image copyright: Michael M. Santiago [via Getty Images]
The Facts
Goldman Sachs on Wednesday filed a complaint in a British court for arbitration against Malaysia amid a disagreement over a 2020 settlement tied to the role of the Wall Street bank in the multibillion-dollar 1MDB investment-fund scandal, the biggest foreign bribery case in US enforcement history.
This comes as Goldman argued that the Southeast Asian country has violated its obligations to appropriately credit assets against the guarantee provided in the agreement and to recover other assets, with Prime Minister Anwar Ibrahim urging the firm to honor its settlement earlier this year.
The Spin
Narrative A
Goldman Sachs has every right to demand arbitration in this case, as the government of Malaysia has, in bad faith, tried to take advantage of its asymmetrical power by demanding a new settlement with more onerous penalties as well as by not being transparent with regard to the recovery of looted assets.
Narrative B
It's clear that Goldman Sachs has sued Malaysia only to divert attention away from its obligation to hand over the agreed $250M interim payment, as the company has failed to recover the stipulated amount of $500M two years from the signing of the deal. After an entire year requiring deadline extensions, apparently in good faith, Goldman has shown its malicious intention.