1MDB Recovery Agreement With Goldman Sachs Vague

The agreement signed between the Malaysian government and Goldman Sachs Group Inc (Goldman Sachs), regarding the recovery of 1Malaysia Development Bhd (1MDB) assets in 2020, was vague and not detailed, said 1MDB Asset Recovery Taskforce chairman, Datuk Seri Johari Abdul Ghani.

He said that the matter was a factor in Goldman Sachs taking advantage of not wanting to fulfil its asset recovery guarantee, amounting to US$1.4 billion (RM6.63 billion) to the Malaysian government.

“In 2020, we had come to an agreement, we were paid US$2.5 billion (RM11.84 billion) and then promised to be paid another US$1.4 billion (recovery of assets), but the agreement signed was not clear.

“It (Goldman Sachs) took advantage by refusing to pay US$1.4 billion because it said that we had collected through AmBank, a fine of US$640 million (RM3.03 billion). Then, we received about US$430 million (RM2.03 billion) from the DOJ (Department of Justice).

He said that Goldman Sachs also included Malaysia’s settlement with IPIC (International Petroleum Investment Company) to offset it, as part of the firm’s US$1.4 billion asset recovery guarantee; then claimed that its obligations under the asset recovery guarantee have been discharged (through all the fines and settlement).

“We said no, that the fine and the settlement are not encompassed within the scope of the US$1.4 billion asset recovery guarantee. Hence, there is a dispute, because the agreement is unclear,” he told Bernama.

Previously, Johari, who is also the plantation and commodities minister, reportedly said that the settlement agreement signed in August 2020, between the Malaysian government and Goldman Sachs, required the firm to pay a US$2.5 billion cash payment, and provide Malaysia with a US$1.4 billion asset recovery guarantee.

He added that thus far, the task force is still in the process of seeking arbitration to resolve the matter.

According to him, the process to obtain the US$1.4 billion recovery asset guarantee will also take some time, as it depends on Goldman Sachs’ decision on whether it wants to fight the Malaysian government’s claim regarding the matter through legal proceedings.

He said that, if Goldman Sachs decides to fight it, then the process will take time; if the firm agrees to settle it then it won’t take long. He also cautioned that the process may take a long time as it involves a huge amount of money.

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