Goldman Sachs will pay $500 million to settle a class-action lawsuit alleging the bank misled shareholders about its work for Malaysian sovereign wealth fund 1MDB.
Plaintiffs attorneys disclosed the figure in a court filing Wednesday, one month after the parties said they’d agreed to settle.
“The settlement is an outstanding result for the class,” attorneys for Sjunde AP-Fonden, a Swedish pension fund, wrote in the filing.
Between 2009 and 2014, roughly $4.5 billion was embezzled from 1MDB to fund lavish lifestyles of some of the scheme’s orchestrators.
Shareholders alleged that Goldman downplayed its role in the 1MDB scandal.
Goldman had helped the Malaysian government raise $6.5 billion for the 1MDB fund, collecting roughly $600 million in fees from bond sales in 2012 and 2013, according to the lawsuit, originally filed in 2018.
Goldman’s share price suffered due to its involvement with 1MDB, shareholders alleged.
A spokesperson for Goldman did not respond to an immediate request for comment.
Goldman has paid out billions of dollars for its connection to 1MDB. The bank paid the Malaysian government $3.9 billion in 2020 over its role in the scandal, and it admitted criminal wrongdoing, paying a $2.9 billion settlement to the Justice Department and regulators in the U.K., Singapore and Hong Kong. The bank clawed back $174 million from current and former executives for their roles in the case.
A related Federal Reserve consent order against Goldman was resolved last year. Two former executives – Tim Leissner and Roger Ng – were sentenced to, and remain, in prison for their roles in the scheme.
A judge must approve Wednesday’s settlement.
