Goldman Sachs And 1MDB

It is difficult to have any sympathy for a financial company like Goldman Sachs as they frequently screw up and get bailed by their governments/banks, but this time it looks like Goldman Sachs has bitten off more than it can chew.

Aseef Shameen rightly sets the tone on Goldman's impending doom in the Edge Singapore piece, Goldman Sachs' 1MDB cover-up is bigger than the scandal:

Malaysia wants all of the US$600 million in fees 1MDB paid to Goldman and restitution of a big chunk of the US$3.5 billion it lost. Attorney General Tommy Thomas said recently that reports of him filing a suit in New York claiming US$5.1 billion from Goldman were “premature”.

Of course, it may be premature to be discussing this as investigations are still underway but one does suspect that this Pakatan Harapan government had this task in mind when it appointed Tommy Thomas to the role of AG. Tommy Thomas works extremely quietly and efficiently. Given his very recent track record with securing the yacht Equanimity and his progress with Abu Dhabi's IPIC, this man will save Malaysia millions, if not a billion.

You may be wondering how Goldman has a hand in this 1MDB scandal. This is why it's in trouble:

It raised US$6.5 billion for 1MDB. The DOJ alleges that over US$3.5 billion was misappropriated from those funds by Jho Low, a close confidant of Najib. In pleading guilty to money laundering and bribery charges, Leissner blamed the 1MDB shenanigans on Goldman’s “culture” of working around internal legal and compliance controls, as it was highly focused on consummating deals. Jho Low has been charged in absentia with money laundering and violation of bribery laws by the DOJ. He remains on the run and is reportedly in hiding in China.

A lot of people are dying to get their hands on the Whale.

Given the excesses detailed in the book and judging by the calls to BFM over the issue, Malaysians are livid.

Predictably, Goldman Sachs have denied knowing Jho Low.

They're not the only ones.

Najib Razak now claims that he was cheated by Jho Low, and more ludicrously, claimed he was not aware that anything was wrong because he was not told about it.

Tong Kooi Ong of the Edge Media spills the beans and sets the story straight on what really happened in You didn’t know Jho Low cheated us? I showed you evidence and you showed me the door:

He put the blame solely on Goldman Sachs and 1MDB’s lawyers and auditors for allowing wrongdoings to take place.

“They should have informed me if something was not right,” Najib said. “They clearly failed in carrying out their responsibilities.”

While Najib plays the victim for the peanut gallery, it's rather intriguing how he appears to have such a close relationship with Jho Low.

Tong Kooi Ong describes it:

I then proceeded to tell Najib that Jho Low must be held accountable and be prosecuted. This upset him. He immediately stood up, walked to the door and asked me to leave.

I was taken aback that he was so sensitive about Jho Low.

While The Edge’s reporting was focused on 1MDB and Jho Low, [Paul] Stadlen [(Najib's media adviser)] made it very clear that any attack on Jho Low was an attack on Najib, and that he was conveying this message from his boss.

If you choose to read just one article this coming week, I urge you to make it Tong Kooi Ong's expose. If this piece does not go viral, Malaysians are not worth their salt.

Najib wants you think that he was cheated and that he is innocent, but nothing could be further from the truth.

Do not be fooled.