Goldman Sachs is working to soothe tensions with the Malaysian government over the 1Malaysia Development Berhad money laundering scandal, Malaysia’s Prime Minister Anwar Ibrahim told Bloomberg News in New York.
The main point of contention between the investment bank and the Southeast Asian country lies in a single detail in the settlement: Goldman Sachs was required to make a one-time interim payment of $250 million if the government did not receive at least $500 million by August 2022.
The two sides disagree as to whether the $500 million payment was in fact made by the August 2022 deadline. When reached for comment, Goldman pointed to this year’s second-quarter earnings report, which explains that “If the parties are unable to resolve this dispute, it would be settled by arbitration.”
Anwar told Bloomberg that while the entire settlement doesn’t need to be re-evaluated, some issues need to be addressed.
“A settlement is ‘possible because we are not unreasonable, we ask what is reasonable, and I even refused to state the quantum because then we should allow for some flexibility to discuss,'” the Malaysian prime minister said. “‘I don’t think it’s fair to suggest that the entire deal has got to be relooked into, but there are specific areas where there is a flaw. Maybe we just focus on that.'”
The initial sum was agreed to three years ago by former Prime Minister Muhyiddin Yassin. Anwar took office last November.
Analysts say that the Malaysian government is likely seeking to re-negotiate the settlement in order to secure more money from Goldman Sachs. Anwar has previously said that the original settlement was too small, and he has also threatened to sue the bank again.
Goldman Sachs has said that it is committed to complying with the terms of the settlement, and that it is working to resolve the dispute with the Malaysian government. However, the bank has also said that it is prepared to go to arbitration if necessary.
The outcome of the dispute between Goldman Sachs and the Malaysian government could have implications for other financial institutions that have been accused of involvement in the 1MDB scandal. The Malaysian government has said that it is committed to recovering as much money as possible from those who profited from the scandal.