Malaysia Charges Goldman Sachs Over 1MDB Embezzlement Scandal - Attorney General

Malaysia has brought charges against investment bank Goldman Sachs and two of its former employees over their alleged involvement in the embezzlement and corruption scandal surrounding state-run development fund 1Malaysia Development Berhad (1MDB), the country's attorney general, Tommy Thomas, said in a statement on Monday.

MOSCOW (UrduPoint News / Sputnik - 17th December, 2018) Malaysia has brought charges against investment bank Goldman Sachs and two of its former employees over their alleged involvement in the embezzlement and corruption scandal surrounding state-run development fund 1Malaysia Development Berhad (1MDB), the country's attorney general, Tommy Thomas, said in a statement on Monday.

"Criminal charges for offences under the securities laws of Malaysia were filed today against subsidiaries of Goldman Sachs investment bank, its [former] key employees, Tim Leissner and Roger Ng Chong Hwa (who will be charged shortly), together with former employee of 1MDB, Jasmine Loo Ai Swan and [Malaysian businessman] Low Taek Jho," the statement said.

The accused are believed to have embezzled $2.7 billion from the profit made through three bonds issued by 1MDB-related structures. Goldman Sachs employees are also accused of being a part of a conspiracy to bribe Malaysian officials and ensure the bank's participation in the issuance of bonds, which then allowed Goldman Sachs to receive $600 million for arranging and underwriting the securities.

"The scheme designed and crafted by the accused to fraudulently structure the Bonds for ostensibly legitimate purposes when they knew that the proceeds thereof would be misappropriated and fraudulently diverted by the accused themselves was planned and executed in order to defraud the Government of Malaysia and the purchasers of the Bonds," the statement said.

The statement added that the prosecution would demand that the accused pay more in fines than they had illegally obtained and are given jail time.

Malaysia created the 1Malaysia Development Berhad fund in 2009 to promote economic development in the country through direct foreign investment and global partnerships.

Malaysia and a number of other countries have been carrying out investigations into cases related to the fund's financial mismanagement and corruption. Former Malaysian Prime Minister Nijab Razak was among those suspected of diverting hundreds of millions of Dollars from 1MDB into his private accounts. In 2017, the US Justice Department said that more than $4.5 billion had been reportedly embezzled by the fund's officials between 2009 and 2015.