Goldman Sachs CEO apologises to Malaysia, says people were “defrauded”

Goldman Sachs Ceo Apologises To Malaysia, Say People Were “defrauded”David Solomon, new CEO of Goldman Sachs Group (pictured), apologised to the Malaysian people for the role that a senior banker at the firm, Tim Leissner, played in the scandal involving state investment fund 1Malaysia Development Berhad, or 1MDB.

Malaysia was “defrauded by many individuals,” Solomon said on a conference call with analysts after the investment bank reported fourth-quarter earnings on January 16. Leissner “was one of those people, and for his role in that fraud, we apologise to the Malaysian people,” he said.

Between 2012 and 2013, Goldman advised 1MDB on two 2012 bond sales. It raised $3.5 billion. A third offering, also underwritten by Goldman, raised another $3 billion in 2013. Leissner was Goldman’s Southeast Asia chairman. Goldman earned $600 million for its work on the fund.

Leissner, a German national, pleaded guilty last year to laundering money and conspiring to violate the Foreign Corrupt Practices Act. As part of his plea deal, Leissner has agreed to forfeit $43.7 million.

But Solomon also defended the bank as a whole, saying it had been misled by Leissner and senior officials in the Malaysian government about the role of a key intermediary in the scandal, “financier” Jho Low.

Solomon said employees at Goldman were “extremely angry” about Leissner’s role but that morale was good on the whole due to the bank’s strong financial performance. Goldman has suffered a “reputation dent” tied to the scandal, Solomon acknowledged, but added that the effect on clients had been “minimal.”

UPDATE: Malaysia’s finance minister Lim Guan Eng said on January 18 that an apology by Goldman Sachs for its role in the 1MDB scandal was “not enough” and that he sticks to his demand the financial firm had to pay $7.5 billion in damages and compensation to Malaysia.

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David Solomon, new CEO of Goldman Sachs Group (pictured), apologised to the Malaysian people for the role that a senior banker at the firm, Tim Leissner, played in the scandal involving state investment fund 1Malaysia Development Berhad, or 1MDB. Malaysia was “defrauded by many individuals,” Solomon said on a conference call with analysts after the investment bank reported fourth-quarter earnings on January 16. Leissner “was one of those people, and for his role in that fraud, we apologise to the Malaysian people,” he said. Between 2012 and 2013, Goldman advised 1MDB on two 2012 bond sales. It raised $3.5 billion....

Goldman Sachs Ceo Apologises To Malaysia, Say People Were “defrauded”David Solomon, new CEO of Goldman Sachs Group (pictured), apologised to the Malaysian people for the role that a senior banker at the firm, Tim Leissner, played in the scandal involving state investment fund 1Malaysia Development Berhad, or 1MDB.

Malaysia was “defrauded by many individuals,” Solomon said on a conference call with analysts after the investment bank reported fourth-quarter earnings on January 16. Leissner “was one of those people, and for his role in that fraud, we apologise to the Malaysian people,” he said.

Between 2012 and 2013, Goldman advised 1MDB on two 2012 bond sales. It raised $3.5 billion. A third offering, also underwritten by Goldman, raised another $3 billion in 2013. Leissner was Goldman’s Southeast Asia chairman. Goldman earned $600 million for its work on the fund.

Leissner, a German national, pleaded guilty last year to laundering money and conspiring to violate the Foreign Corrupt Practices Act. As part of his plea deal, Leissner has agreed to forfeit $43.7 million.

But Solomon also defended the bank as a whole, saying it had been misled by Leissner and senior officials in the Malaysian government about the role of a key intermediary in the scandal, “financier” Jho Low.

Solomon said employees at Goldman were “extremely angry” about Leissner’s role but that morale was good on the whole due to the bank’s strong financial performance. Goldman has suffered a “reputation dent” tied to the scandal, Solomon acknowledged, but added that the effect on clients had been “minimal.”

UPDATE: Malaysia’s finance minister Lim Guan Eng said on January 18 that an apology by Goldman Sachs for its role in the 1MDB scandal was “not enough” and that he sticks to his demand the financial firm had to pay $7.5 billion in damages and compensation to Malaysia.

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