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Malaysia says Goldman lawsuit is a chance to review 1MDB deal

Malaysia says Goldman lawsuit is a chance to review 1MDB deal
The Malaysia flag flies in front of the Kuala Lumpur Courts Complex in Kuala Lumpur, Malaysia, on Monday, 7 January 2019.

Malaysia said a lawsuit Goldman Sachs initiated amid festering disagreement involving the multibillion-dollar 1MDB scandal gives the country a chance to review a contentious settlement it had previously struck with the bank.  

Second Finance Minister Amir Hamzah Azizan told the country’s parliament on Tuesday that the arbitration suit Goldman filed last year in the UK court “reopens pathways” for parties to take another look at the deal, and “step up efforts to recover assets related to 1MDB”. 

Looting of the 1MDB investment fund by officials in Malaysia after Goldman helped it raise money spawned a multibillion-dollar scandal and probes across continents. Months after its initial agreement with Malaysia, Goldman admitted to its role in the biggest foreign bribery case in US enforcement history, reaching multiple international settlements exceeding $5-billion.

As part of a 2020 settlement with Malaysia, Goldman was required to make an interim payment of $250-million if Malaysia didn’t receive at least $500-million of 1MDB assets and proceeds by August 2022, according to Goldman. The US bank has said in public filings that it doesn’t believe an interim payment is required — a position that the Malaysian government disputes, prompting Goldman to initiate the lawsuit. 

Malaysian Prime Minister Anwar Ibrahim said last year he wants to renegotiate the settlement terms and the bank has not been forthcoming. Malaysia is probing the lawyers who worked on the settlement. 

Amir Hamzah said on Tuesday that the government has paid a total of 48.06 billion ringgit ($10.1-billion) in 1MDB debt as of last year. The only remaining obligation is a 5 billion ringgit sukuk, or Islamic security, maturing in 2039, he said. 

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