'PM should explain if M'sians shortchanged in Goldman Sachs settlement'
Former finance minister Lim Guan Eng wants the Perikatan Nasional government to explain if Malaysians were shortchanged when it entered into a settlement with Goldman Sachs for only US$3.9 billion (RM16.62 billion), of which only US$2.5 billion (RM10.66 billion) will be cash coming from the bank as reparations for its role in the 1MDB scandal.
Lim said the previous Pakatan Harapan government had claimed US$7.5 billion (RM31.97 billion) which included the value of the three bonds Goldman Sachs arranged for 1MDB worth US$6.5 billion (RM27.71 billion) and an additional US$1 billion (RM4.26 billion) to cover the interest cost to date.
Former finance minister Lim Guan Eng wants the Perikatan Nasional government to explain if Malaysians were shortchanged when it entered into a settlement with Goldman Sachs for only US$3.9 billion (RM16.62 billion), of which only US$2.5 billion (RM10.66 billion) will be cash coming from the bank as reparations for its role in the 1MDB scandal.
Lim said the previous Pakatan Harapan government had claimed US$7.5 billion (RM31.97 billion) which included the value of the three bonds Goldman Sachs arranged for 1MDB worth US$6.5 billion (RM27.71 billion) and an additional US$1 billion (RM4.26 billion) to cover the interest cost to date.
According to the bonds arranged by Goldman Sachs, of which substantial sums were eventually misappropriated, 1MDB was to pay a coupon rate of 5.99 percent for the first US$1.75 billion bond, 5.75 percent for the second US$1.75 billion bond and 4.4 percent for the third US$3 billion bond.
Under the settlement totalling US$3.9 billion (RM16.62 billion), Goldman Sachs will only pay US$2.5 billion (RM10.66 billion) cash to the Malaysian government while the remaining US$1.4 billion (RM5.97 billion) will only be a "guarantee" to ensure assets acquired using stolen 1MDB funds will eventually be returned to Malaysia.
The process to seize, liquidate and return these assets are largely being conducted by the US Department of Justice.
"Apart from the US$2.5 billion cash payment, if Goldman Sachs is willing to recover the remaining US$4 billion in stolen assets, and not just US$1.4 billion, the Malaysian government can be justified for settling for US$6.5 billion, and forgo the additional US$1 billion of claims in interest servicing cost on our part.
"To forgo the initial US$7.5 billion claim with only US$3.9 billion ignores the huge debt burden of 1MDB," Lim said.
"The total 1MDB debt outstanding guaranteed by the government is RM31.7 billion. If the remaining interest payments until 2038 are included, the amount will increase to RM 41.5 billion.
"This sum excludes the RM8.9 billion which have already been paid by the government. This will bring the total cost to the country, including interest of the 1MDB debts, to RM50.4 billion," he added.
Lim said Prime Minister Muhyiddin Yassin (below) should explain whether Goldman Sachs was being left off lightly and Malaysians were being sold short.
"For settling all our claims and criminal action against Goldman Sachs, Goldman Sachs is effectively paying only US$2.5 billion cash.
"Even if not the full US$7.5 billion claim, the settlement should be at least US$6.5 billion that Goldman Sachs was responsible for raising the three bonds.
"The prime minister should assure the public that he has not sold Malaysians short or allowed Goldman Sachs to get off too lightly for their involvement in one of the largest financial scandals in history – the RM50.4 billion 1MDB scandal," he said.
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