Skip to navigationSkip to content

Goldman’s Malaysian Malaise

This article is more than 2 years old.

Part of the reason Goldman’s stock now trades below its tangible book value is the still unknown consequences of an unfolding financial scandal involving two, and perhaps more, of its former bankers in Asia and the embezzlement of billions of dollars from 1MDB, a Malaysian sovereign wealth fund.

According to allegations contained in filings in a Brooklyn court, the Goldman bankers paid bribes and kickbacks in order to get the mandate to underwrite $6 billion in bonds for the fund, earning Goldman some $600 million in fees. The bond proceeds were supposed to be used to benefit the Malaysian people, but instead, big chunks of the bonds sold (said to be valued around $4.5 billion) went into private accounts. They included accounts belonging to Tim Leissner, the Goldman banker who pleaded guilty to the scheme, and Jho Low, a Malaysian businessman who spent millions of dollars of the money bestowing gifts on Hollywood celebrities and buying expensive toys like a $250 million yacht and a private jet.

Reuters/Lai Seng Sin
Lho’s luxury yacht Equanimity, seized by Malaysia.

Enrich your perspective. Embolden your work. Become a Quartz member.

Your membership supports a team of global Quartz journalists reporting on the forces shaping our world. We make sense of accelerating change and help you get ahead of it with business news for the next era, not just the next hour. Subscribe to Quartz today.

Membership includes:

Quartz Japanへの登録をご希望の方はこちらから。