Goldman Sachs has agreed to pay $500 million to settle a class-action shareholder lawsuit stemming from its role in the sprawling 1MDB corruption scandal, the bank confirmed Thursday. The settlement, which still requires court approval, resolves claims that Goldman executives misled investors about the bank’s compliance systems and its work with Malaysian state investment fund 1MDB. The payout, one of the largest shareholder settlements tied to a single scandal, underscores the staggering financial and reputational toll the affair has taken on the Wall Street giant.
The lawsuit, filed by shareholders who bought Goldman stock between 2013 and 2018, alleged that the bank’s top brass, including former CEO Lloyd Blankfein, made false statements about the firm’s internal controls while it was secretly profiting from a massive bribery and money laundering scheme. The 1MDB scandal, in which Goldman helped raise $6.5 billion in bond deals for the fund, ultimately siphoned billions into the pockets of corrupt officials and financiers. The bank has already paid more than $5 billion in penalties to global regulators and pleaded guilty in 2020 to a U.S. charge of conspiracy to violate the Foreign Corrupt Practices Act.
For Las Vegas, the settlement is a reminder of the far-reaching tentacles of the 1MDB saga, which has local resonance. Much of the stolen money was allegedly laundered through U.S. real estate, luxury goods, and even Hollywood productions, but the scandal also touched Sin City directly. Former Goldman banker Tim Leissner, a central figure in the scheme, was a known figure in Las Vegas high-roller circles, and the case has long served as a cautionary tale for the financial and gaming industries about the risks of lax oversight. The $500 million payout, while substantial, does not end Goldman’s legal exposure, as related civil cases and international probes continue. For shareholders, the settlement offers a measure of accountability, but the damage to trust in one of the world’s most prestigious financial institutions remains a lasting scar.
English (US)·