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Goldman Legal Woes Mount as Malaysia Slaps First Criminal Charge
- ReptileMan 8y agoStrongly recommend Billion Dollar Whale on the 1MDB ... Amazing and extremely entertaining book. They literally stole 16 billion usd.
- kyrra 8y agoNot sure if the book covered it, but WSJ had a piece that told the story of some of that money being used to pay for some of the most expensive birthday parties ever in Vegas. https://www.wsj.com/articles/the-billion-dollar-mystery-man-and-the-wildest-party-vegas-ever-saw-1536984061 https://www.wsj.com/articles/the-billion-dollar-mystery-man-...
- natechols 8y agoThose are the authors of the book, and I think that's what became the first chapter.
- zawerf 8y agoI found this summary of the book pretty good if you don't have time: https://www.reddit.com/r/slatestarcodex/comments/9w1b19/the_amazing_tale_of_possibly_the_most_successful/ https://www.reddit.com/r/slatestarcodex/comments/9w1b19/the_...
- magic_beans 8y agoFascinating summary, but the comments got really nasty with people throwing around some pretty cruel terms for women. :|
- shaki-dora 8y agoHN does not see kindly upon people pointing out rabid misogyny, because misogynists are easily offended, and may get the wrong idea that there behaviour is, well, wrong. Edit: After reading the actual comment in the linked threat, they are surprisingly, I don't know, self-aware? I wouldn't write any of those posts myself, but it's also not quite as bad as one expects, considering some other fare I've seen in the comments to Scott Alexander's blog posts.
- georgeecollins 8y agoStrongly agree! Book is a great primer on how / why crooks drive up the price of high end real estate, art and film financing. You will never wonder how these businesses can charge so much again. At one point (when the 1MDB company is financing the Wolf of Wall Street) the original true life "Wolf of Wall Street" person says: I don't want to have anything to do with these people, they must be crooked. The only reason why you spend money like this is if it is stolen. Exactly!
- bps4484 8y agoI would recommend the book, but would skim the first 300 or so pages and only read deeply the parts that catch your eye. I think the author was on a mission to get the book to 400 pages and there is a LOT of filler on every detail of every Jho Low party and the types of gems the wife of the PM of malaysia bought.
- fbanks 8y agoFinancial crime investigator here - also recommend "Sarawak Report" book by Clare Brown. She was originally researching deforestation and local corruption in Malaysian Borneo and kept running into Jho Low adjacent figures and eventually helped to source the key documents tying the whole scheme together. Had to order it from the UK and it's even longer than the Whale book, but full of crazy stories.
- ralph84 8y agoMalaysia does what the US should have done 10 years ago.
- deleted 8y ago[deleted]
- sphinxpy 8y agoMy thought exactly.
- chiefalchemist 8y agoNot to get off-topic but if the current administration did what the admin of 10 years ago did (or didn't do), there would be massive endless outrage. As it is, most people have complete amnesia of what did / did not happen 10 years ago.
- shaki-dora 8y agoYou did, indeed, get off-topic.
- fmajid 8y agoAnd the EU, when Goldman Sachs helped the Greek government evade caps on its deficit.
- pkaye 8y agoThe former Malaysian PM is one of those who stole the money though.
- mynameisvlad 8y agoHe's the former Malaysian PM. This is a policy enacted by the current Malaysian PM. How does the previous administration's actions impact what the current one is doing or what the US should be doing, which is what the parent comment is talking about?
- 8y ago
- gammateam 8y ago> "If the outcome of the case results in a criminal conviction against the bank, there are potentially severe reputational and financial risks to the bank, as well as the bank’s standing as a licensed financial institution with regulators worldwide." Anybody have any insight into what these consequences realistically are? Malaysia is an irrelevant market to a global investment bank, or it can be. This is precisely why even the LARGEST governments of single markets don't do this specific thing. Malaysia's super-damning criminal charges are just fines. Goldman not paying this out already is just because: A) Its a larger fine than a market of that size can normally get kickbacked B) They want to change the semantical definition of the criminal charge, to civil one and whatever the "due process" version of a legal kickback is called in that country, without admitting or denying anything Everyone knows these are racketeers, does admitting a criminal in an irrelevant country change that? Does "denying but paying off" a criminal charge in an irrelevant country change that? https://violationtracker.goodjobsfirst.org/parent/goldman-sachs https://violationtracker.goodjobsfirst.org/parent/goldman-sa... Goldman has paid $9,602,492,860 since the year 2000 to various US financial regulators and has suffered no reputational effect while subsequently: losing all of Libya's money in a fund created basically the day after sanctions got lifted. Winning the Malaysia government's business and losing that money too. The only difference is that this time we aren't changing the regime of Malaysia, so answer me this, does it really matter for Goldman?
- cm2187 8y agoMy guess is that the main damage is reputation, just like for McKinsey in South Africa.
- lordnacho 8y ago> has suffered no reputational effect Well there's no objective way to measure this, but my sense is they've fallen a hell of a long way in terms of rep from when they were a partnership just under 20 years ago.
- gammateam 8y agoTheir ability to obtain and create the best deal flow undermines this. People want this, and this is greater than arbitrary versions of righteous punishment that people want to happen.
- onetimemanytime 8y agoYou know why the Malaysian pols do it? Because their predecessors did and no one went to jail. Arrogance...if they had stolen discretely, and spread the stolen cash around--as it is always done in those parts--they'd be enjoying their money. G R E E D, they pushed the envelope a bit too much. Stay off the f*cking radar Johhny or they'll start asking questions, billion dollars ones.
- taf2 8y agoor maybe something more like: Peter Gibbons: [Explaining the plan] Alright so when the sub routine compounds the interest is uses all these extra decimal places that just get rounded off. So we simplified the whole thing, we rounded them all down, drop the remainder into an account we opened. Joanna: [Confused] So you're stealing? Peter Gibbons: Ah no, you don't understand. It's very complicated. It's uh it's aggregate, so I'm talking about fractions of a penny here. And over time they add up to a lot. Joanna: Oh okay. So you're gonna be making a lot of money, right? see: https://en.wikiquote.org/wiki/Office_Space https://en.wikiquote.org/wiki/Office_Space
- philip1209 8y agoI wonder if Malaysia will try to arrest a Goldman exec in a foreign country and extradite them. The US has set such a scary precedent with the Huawei case. (What I'm referencing: https://edition.cnn.com/2018/12/11/business/huawei-cfo-arrest-details/index.html https://edition.cnn.com/2018/12/11/business/huawei-cfo-arres...)
- donohoe 8y agoIs that precedent setting? Extradition is an established process that goes way-back.
- jjeaff 8y agoThe US already has an extradition treaty with Malaysia. Although I kind of doubt it would have any real implications in this case.
- jeron 8y agousually extradition with regards to the US works one way, not the other
- hackeraccount 8y agoHa ha. https://en.wikipedia.org/wiki/Extraordinary_rendition https://en.wikipedia.org/wiki/Extraordinary_rendition
- chaostheory 8y agoLook at what Libya did: https://www.bloomberg.com/features/2016-goldman-sachs-libya/ https://www.bloomberg.com/features/2016-goldman-sachs-libya/ It's probably coincidence, but look what happened later: https://foreignpolicy.com/2016/03/22/libya-and-the-myth-of-humanitarian-intervention/ https://foreignpolicy.com/2016/03/22/libya-and-the-myth-of-h...
- empath75 8y agoRegardless of whether or not they're convicted -- what country would ever entrust their sovereign wealth fund with Goldman Sachs at this point?
- seanmcdirmid 8y agoOne that was trying to siphon as much of the fund as possible into their prime minister's personal bank account?
- TuringNYC 8y agoClients have short term memories. After all blowback from 2000-2002 and then 2006-2008, i thought, for sure, no one would do business with many of these firms. But memories are short lived.
- cm2187 8y agoOne thing to keep in mind is that after the crisis, a lot of banks scaled back (or were forced to scale back). Lots of banks exited the investment banking market, leaving the incumbants between them. Clients probably didn't have that much of a choice.
- rchaud 8y agoYou make it sound like people vote on these things. Goldman et al skulk around country clubs, policy lunches, even freshman congressional rep orientations, looking to "build relationships". They take them to fancy parties and dinners paid for by the bank, digging their claws in. When the time comes to do a bond issue, they get the call.
- deleted 8y ago[deleted]
- rajacombinator 8y agoThey are more likely to experience a “regime change” than to get anything meaningful to stick against GS...
- hristov 8y agoSomebody has to make a movie about this whole story and entitle it "The Real Wolf of Wall Street"
- howlingfantods 8y agoThe rights to the book Million Dollar Whale, which describes this story, has already been picked up.