14-9-2023 (SINGAPORE) Prime Minister Anwar Ibrahim of Malaysia has issued a stern warning to US investment bank Goldman Sachs, asserting that his country is not a “banana republic” and will take significant measures to recover the majority of the public funds lost in the multibillion-dollar 1Malaysia Development Berhad (1MDB) financial scandal.
Speaking at the Asia Summit organized by the Milken Institute in Singapore, Mr. Anwar conveyed a clear message to Goldman Sachs, urging the bank not to underestimate Malaysia’s resolve in retrieving the misappropriated funds. He called on the bank to revisit the settlement it reached over 1MDB with the previous Malaysian government and renegotiate the terms.
Mr. Anwar emphasized that the issue is far from over and that there are unresolved concerns to address. He expressed his desire to recover as much of the lost money as possible, with the intention of allocating the funds to public education, healthcare, and other essential services.
Under a 2020 settlement reached with the previous administration led by Muhyiddin Yassin, Goldman Sachs agreed to pay Malaysia US$3.9 billion for its role in the 1MDB case. In return, Kuala Lumpur agreed to drop all criminal proceedings against the bank, which included a US$2.5 billion cash payment and a guarantee to return US$1.4 billion in assets to Malaysia.
Malaysian and US authorities estimate that approximately US$4.5 billion was embezzled from 1MDB between 2009 and 2014 in a complex scheme involving high-level government and banking officials in Malaysia and other countries.
Mr. Anwar underscored that Malaysia suffered greatly due to the 1MDB scandal, which could not have occurred without the complicity of international financial institutions, particularly Goldman Sachs. While he did not disclose the exact amount recovered from Goldman Sachs, he emphasized that the bank should not underestimate Malaysia’s determination to seek justice.
He also hinted at the possibility of taking a tougher stance, including legal action, against Goldman Sachs, reiterating this warning ahead of his upcoming trip to the United Nations General Assembly in the United States.
Despite acknowledging that a previous settlement had been reached under the former Prime Minister Muhyiddin’s administration, Mr. Anwar maintained that he has legitimate concerns to raise, urging the bank to engage in discussions and address these issues amicably.
In addition to addressing the Goldman Sachs issue, Mr. Anwar expressed his determination to bring back Roger Ng Chong Hwa, a convicted former Goldman Sachs banker, and financier fugitive Low Taek Jho, both of whom are linked to the 1MDB case.
Roger Ng played a central role in the 1MDB scandal and was convicted in April 2022, receiving a 10-year prison sentence in a US District Court. Malaysia is currently negotiating Ng’s extradition with the US Department of Justice to aid in the ongoing efforts to push Goldman Sachs back to the negotiation table.
Low Taek Jho, commonly known as Jho Low, is believed to be hiding in Macao and has been charged in both Malaysia and the United States for his alleged role in the embezzlement of US$4.5 billion from 1MDB.
Mr. Anwar emphasized Malaysia’s determination to bring Jho Low to justice and recover the stolen funds, underscoring that the government is exploring all available options.
Regarding Malaysia’s diplomatic relations with China and the United States, Mr. Anwar emphasized that Malaysia remains fiercely independent and maintains good relations with both superpowers. He stressed that Malaysia welcomes investments and technological advancements from any source that benefits the country, regardless of global power dynamics.
In particular, Mr. Anwar highlighted the importance of safeguarding Malaysia’s territorial waters amid overlapping claims in the South China Sea. He noted that discussions with Premier Li Qiang during the recent Association of Southeast Asian Nations (ASEAN) Summit resulted in a commitment from China to respect Malaysia’s territorial waters.
Mr. Anwar reaffirmed Malaysia’s stance on defending its rights and interests in the disputed area, particularly in protecting state energy firm Petronas’s projects in the South China Sea.
After the Asia Summit, Mr. Anwar also met with Singapore Prime Minister Lee Hsien Loong to discuss their countries’ ongoing cooperation and shared goals. PM Lee emphasized the strong and multifaceted collaboration between Malaysia and Singapore, highlighting the potential for further cooperation to benefit both nations.
