Legal
Middle East SWF Accuses Goldmans Over Malaysia Corruption Case - Report
A sovereign wealth fund in the Gulf has accused the US investment bank of being an important player in the 1MDB corruption case that has spread around the world.
Goldman Sachs
has been accused by an Abu Dhabi sovereign wealth fund of being a
central player in an international corruption scandal originating
in Malaysia, the Wall Street Journal reported.
International Petroleum Investment Company, which for a period
had been an investment partner of 1Malaysia
Development Bhd – 1MDB – named the US investment
bank in a lawsuit filed in a state court in New York. The case
notes, which also named several other individuals associated with
1MDB, did not specify the amount of damages that IPIC was
seeking, the WSJ said.
“Goldman Sachs conspired with others to bribe IPIC’s and Aabar’s former executives,” the court filing said, referring to IPIC’s subsidiary Aabar Investments PJS.
“We are in the process of assessing the details of allegations
and fully expect to contest the claim vigorously,” Goldman Sachs
was quoted by the publication as saying.
US authorities, along with those in Singapore, Switzerland and
other jurisdictions have examined a web of illicit money
transfers connected to 1MDB, a fund set up by the Malaysian
government. It is claimed that the fund was used by local
politicians and others to launder money. In Singapore, for
example, two banks accused of lax controls over dealings with
1MDB, Falcon Private Bank and BSI, were banned from operating in
the Asian city-state.
IPIC and its successor, Mubadala Investment Co, are long-time
investment-banking clients of Goldman Sachs, the WSJ
said.
The report added that any moves by Abu Dhabi to move business
away from Goldman could influence other governments in the Middle
East.
As previously reported, former Goldman Sachs partner Tim
Leissner, who travelled to Abu Dhabi several times to meet IPIC
executives during the 1MDB dealings, pleaded guilty to conspiracy
to money laundering and violating anti-bribery laws in the
Justice Department case unsealed earlier in November.
