BUSINESS

Goldman Sachs officials reach US$79.5M shareholder settlement over 1MDB scandal

NEW YORK –


Goldman Sachs Group Inc. officers and directors reached a US$79.5 million settlement to resolve shareholder claims that their poor oversight contributed to the bank being enmeshed in the looting scandal at Malaysia’s 1MDB sovereign wealth fund.


A preliminary settlement of the so-called shareholder derivative lawsuit was filed on Friday in Manhattan federal court, and requires approval by U.S. District Judge Vernon Broderick.


The defendants’ insurers would pay the US$79.5 million to Goldman, which would apply it toward compliance and governance measures, including giving more power to its chief compliance officer and creating an anonymous hotline for employee tips.


U.S. prosecutors have said Goldman helped 1MDB arrange US$6.5 billion of bond sales, but that $4.5 billion was diverted via bribes and kickbacks to government officials, bankers and others.


Shareholders led by the Atlanta-based Fulton County Employees’ Retirement System sought to hold Goldman chief executive David Solomon, his predecessor Lloyd Blankfein and others responsible for “conscious disregard of their oversight obligations” as the bank missed “red flags” of the fraud.


None of the defendants admitted wrongdoing or liability in agreeing to settle. Goldman spokeswoman Maeve DuVally declined to comment.


The bank previously agreed to pay billions of dollars to authorities in the United States and other countries over 1MDB, and in 2020 entered a three-year deferred prosecution agreement with the U.S. Department of Justice.


On April 8, former Goldman banker Roger Ng was convicted in Brooklyn, N.Y., on bribery and money laundering charges over his role in the scandal.


Led by the firm Saxena White, the shareholders’ lawyers called the US$79.5 million payout “an outstanding recovery for the company,” and the second-largest shareholder derivative settlement in the federal court circuit that includes New York.


The lawyers plan to seek fees of up to 25% of the settlement amount, or about US$19.9 million, which Goldman would pay.


The case is Fulton County Employees’ Retirement System v Blankfein et al, U.S. District Court, Southern District of New York, No. 19-01562.


(Reporting by Jonathan Stempel in New York; Editing by Bill Berkrot)


Share this news on your Fb,Twitter and Whatsapp

File source

Times News Express – Breaking News Updates – Latest News Headlines
Times News Express||USA NEWS||WORLD NEWS||CELEBRITY NEWS||POLITICS||TOP STORIES

Show More

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close