US calling for Goldman Sachs guilty plea in 1MDB scandal: Report, Latest Business News - The New Paper

US calling for Goldman Sachs guilty plea in 1MDB scandal: Report

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NEW YORK The US Justice Department is calling for Goldman Sachs to plead guilty for its role in the massive corruption scandal involving Malaysian investment fund 1MDB, The Financial Times reported on Wednesday.

That recommendation applies to any settlement between Goldman Sachs and US or state authorities, the newspaper reported, citing unnamed sources.

It would be the toughest penalty the Justice Department could impose, as it potentially could affect the financial giant's license and ability to conduct business.

According to a source close to the investigation, the hard line recommendations by investigators are not surprising, but the final settlement is likely to be less onerous.

The Justice Department did not immediately respond to a request for comment from AFP. But experts have said Goldman Sachs could face a fine of US$2 billion (S$2.7 billion).

US authorities have accused a Malaysian financial intermediary, Low Taek Jho, former Goldman partner Tim Leissner and former Goldman banker, Ng Chong Hwa, of conspiring to launder billions of dollars from 1 Malaysia Development Berhad, a fund set up to finance development projects.

US officials say more than US$2.7 billion in funds was misappropriated while Goldman garnered US$600 million in fees and revenues from three bond issues in 2012 and 2013.

Leissner pleaded guilty, while Jho Low and Ng Chong Hwa deny the allegations.

Goldman Sachs has tried to distance itself from its two former employees.- AFP