The final bill for Goldman Sachs’s little Malaysian misadventure has at last come in, and it is breathtaking. On top of the $3.9 billion the bank has already agreed to pay, you know, the Malaysians it helped bilk of $6.5 billion, there’s $350 million to the authorities in Hong Kong, $122 to those in Singapore, and now $2.9 billion to the Justice Department and Securities and Exchange Commission at home or, as before, about as much money as it makes in three months. And while it’s not actually as bad as adding all of those very big numbers up into one really, really very big number—$1.4 billion of the Malaysia deal isn’t actually Goldman’s money at all, and the U.S. settlement includes credits for all of those foreign settlements that bring the final bill down to about $5.1 billion, it does get worse for the Elect: Not only was the U.S. settlement significantly larger than expected, they’ve had to admit they are not infallible.
Goldman Sachs's Malaysian subsidiary has pleaded guilty to charges that it conspired to violate US anti-bribery laws in a massive scheme involving the Southeast Asian country's sovereign wealth fund, known as 1MDB…. “We are not putting the lessons learned from this experience behind us," [CEO David Solomon] said. "When a colleague knowingly violates a firm policy, or much worse, the law, we — as a firm — have to accept responsibility and recognize the broader failure that individual behavior represents for our firm."
And since that’s an even greater crime than whatever the hell it is Goldman’s alleged to have done to a faraway country full of people of whom we know nothing, there must be an even more serious punishment. First, of those “colleagues knowingly violating firm policies”:
Goldman is seeking to claw back $76 million from the three former employees most implicated in the scandal, the bank’s board said Thursday. The names of the bankers are Timothy Leissner, Roger Ng and Andrea Vella.
On top of that, five former senior executives including Blankfein have been asked to return $67 million in long-term compensation awarded back in 2011.
And lastly, those left behind to clean up the mess.
Solomon, his chief operating officer, chief financial officer and international division head will have their 2020 pay cut by $31 million. Those awards will be paid out in February of next year.
Goldman is clawing back or cutting millions in pay from CEO Solomon, Blankfein and others over 1MDB [CNBC]
Goldman Clawbacks Are More Stunning Than $5 Billion Penalty [Bloomberg]
Goldman Sachs unit pleads guilty in Malaysian bribery case [CNN Business]
Goldman Fined $350 Million by Hong Kong Over 1MDB Scandal [Bloomberg]
Singapore fines Goldman Sachs US$122 million over 1MDB scandal [Business Times]