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Nothing like some good-old-fashioned hardball.
According to a report by Bloomberg, Goldman has failed to convince its former president Gary Cohn to return $10 million in past compensation as restitution for the 1MDB corruption scandal.
For a full accounting of the 1MDB story, you can read this colorful piece from the Guardian (if you have an hour). In short, certain Goldman employees were implicated in a scandal where nearly $1 billion was siphoned from a Malaysian investment vehicle.
Predictably, the money was used to buy yachts and to shower Victoria’s Secret models with gifts. The main perpetrator is still at large.
Goldman recently admitted wrongdoing in what was the largest foreign bribery case in U.S. history and agreed to pay roughly $5 billion in fines to break free from ongoing investigations.
Although Goldman’s senior-most executives were not implicated, the board called on executives to forfeit pay as a public gesture of remorse for the “institutional failure.”
- In October, Goldman disclosed plans to keep or recoup $67 million awarded to former executives and deduct another $31 million from the 2020 compensation of current top executives.
Six weeks later, Gary Cohn is the lone holdout. According to the report, Goldman has “failed to persuade” Cohn to part ways with the $10 million.
Good To Know: When Cohn left Goldman for a brief stint as the director of the National Economic Council in 2017, he was able to accelerate $65 million in cash and stock rewards and another $220 million of Goldman equity and stakes in company-run investment funds.
Under certain “conflict-of-interest” laws, Cohn was reportedly able to do so while deferring capital gains tax.
The Takeaway: Must be nice.