Goldman Sachs has agreed to pay US$ 3.9 Billion to the Government of Malaysia.
The payment is compensation for the loss of proceeds from the sale of bonds that Golden the Bank helped raise for the Malaysian Sovereign Wealth Fund.
The deal includes a US$2.5 Billion cash payout by Goldman and a guarantee by the bank to return at least US$1.4 Billion in assets linked to the sovereign bonds.
Authorities in Malaysia had earlier sought for US$7.5 Billion from Goldman Sachs, a US multinational investment bank.
1MDB is the Malaysian State investment fund where several billion dollars disappeared in suspected fraudulent deals. Goldman had helped the Malaysian Government to raise US$6.5billion in a series of bond issues floated between 2012 and 2013.
In December 2018, authorities in Malaysia sued officials at Goldman Sachs units for misleading investigations into this botched bond sales.
Goldman Sachs has maintained its innocence. It has instead pointed fingers at members of the former Malaysian regime. The US bank, which earned US$600 Million in fees from the bond deals, has claimed that rogue employees duped it.
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