“(Goldman) should repay in cash the remaining US$1.4 billion (RM6 billion) of 1MDB losses without quibbling, and straight away,” said Johari according to a Thomson Reuters Regulatory Intelligence report.
According to the report, the agreement between the US investment bank and Muhyiddin’s government anticipates that Malaysia would receive that sum in 1MDB assets by 2025 as part of a US$3.9 billion (RM16.77 billion) settlement reached over losses incurred by 1MDB.
That represents a bad deal for Malaysia, an unnamed government law officer told Reuters.
“(The government) should have demanded cash in the bank, not assets. They have lost the initiative.
“There must be a question about the way the government made the agreement. This is a dispute which can only be resolved by (its) publication,” the law officer was quoted as saying.
He also called on the government to publish the terms of the settlement agreement, which has so far been withheld from disclosure allegedly due to a confidentiality provision which prohibits its release.
The dispute between the bank and Putrajaya centres on two matters – the valuation of 1MDB assets, and Malaysia’s apparent unwillingness to pursue foreign assets identified by Goldman as related to 1MDB.
One aspect of the dispute relates to a provision in the agreement by which the bank guaranteed that Putrajaya will receive US$500 million (RM2.15 billion) worth of 1MDB assets by August last year.
If that was not achieved, Goldman was obliged to pay the government an interim payment of US$250 million.
That payment, however, has not happened, with Goldman and the government at loggerheads over the value of the assets identified. Putrajaya says those assets are only worth US$420 million (RM1.8 billion).
Goldman, however, disputes this, arguing that the Malaysian government has “unilaterally reduced” the value of the assets by US$80 million (RM344 million).
The bank also claims the government has refused to include other substantial assets when tabulating the proceeds already recovered.
“Goldman thinks Malaysia has received US$500 million, and (the government is) saying no,” a source close to the bank was quoted as saying.
The bank also alleges that Malaysia has not rigorously pursued the recovery of assets linked to 1MDB.
“You have to take steps to make that happen. It doesn’t happen passively,” the source was quoted as saying, adding that Malaysia has not been “proactive” in pursuing the recovery.
Two weeks ago, Prime Minister Anwar Ibrahim demanded that Goldman honour its settlement with the government for its role in the 1MDB scandal, saying the bank should not use its financial strength to dictate terms.
In an interview with Bloomberg Television’s Haslinda Amin, Anwar called on Goldman to resolve the dispute over the settlement agreement inked in July 2020 once and for all with Malaysia.