Home Civil Society Voices Goldman Sachs settlement: Can we have some transparency, please?

Goldman Sachs settlement: Can we have some transparency, please?


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What was the reason for the rushed settlement, the Center to Combat Corruption and Cronyism (C4 Center) asks.

The Perikatan Nasional’s government decision to accept a settlement with Goldman Sachs for US$2.5bn in payment of penalty and US$1.4bn in asset value guarantee leaves gaping holes in logical reasoning for the hurried settlement.

Without a doubt, this does not do justice to the alleged crime Goldman has participated in.

The “successful” settlement somehow misses the point.

It disregards the severity of the alleged crime and sidesteps the prominent role Goldman had played in this entire episode of wide-scale corporate fraud.

We must remember that this is not a case of compliance failure by a certain individual or agent of the bank, as claimed by Goldman; rather, it was a full-scale structural scam approved and participated by its top management to scheme and rob billions of US dollars. An extraordinary and exorbitant bank fee of US$600m was charged to 1MDB. All red flags were disregarded. It would also be impossible for bonds totalling US$6.5bn to have been issued without thorough management scrutiny and approval.

C4 Center believes this was the very reason the previous government had decided to prosecute Goldman Sachs and 17 others including the directors under Section 179(c) of the Capital Markets and Services Act, 2007.

The evidence out there is clear, and a conviction is highly probable, according to former Attorney General Tommy Thomas. He further clarified that in addition to securing a conviction, which would render a sharp slap on the credibility and reputation of the Wall Street bank, the courts could order Goldman to pay compensation on the same basis a civil court would under the Capital Markets and Services Act, as demonstrated in the previous cases of Pesaka and Aldwich.

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The following issues beg transparent answers from Finance Minister Tengku Zafrul Aziz:

  • Why then did current Attorney General Idrus Harun amend the criminal charge and allow for a civil disgorgement under the Capital Services and Market Act 2009?
  • Did Goldman come out the only winner here? While we look rather short-changed with the short end of the stick?
  • What was the reason for the rushed settlement?
  • Was the settlement obtained in a hurry to help the struggling economy?
  • Where will the money be deposited, and how will it be disbursed? Is there a plan?

The PN government that abruptly replaced Pakatan Harapan must put forth a strong message to financial institutions and corporations that they cannot get away with massive consequential corporate fraud, money laundering financial crimes and corrupt practices.

The views expressed in Aliran's media statements and the NGO statements we have endorsed reflect Aliran's official stand. Views and opinions expressed in other pieces published here do not necessarily reflect Aliran's official position.

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