Huge sums were stolen from Malaysian state fund 1MDB in a fraud allegedly involving former prime minister Najib Razak and his cronies, and spent on everything from high-end real estate to a luxury super-yacht (MOHD RASFAN)

Kuala Lumpur (AFP) – Malaysia rejected a compensation offer of “less than $2 billion” from Goldman Sachs for the role of its subsidiaries in the multi-billion-dollar 1MDB scandal, an aide to the country’s prime minister said Saturday.

Huge sums were stolen from Malaysian state fund 1MDB in a fraud allegedly involving former prime minister Najib Razak and his cronies, and spent on everything from high-end real estate to a luxury super-yacht.

Goldman’s role has been under scrutiny as it helped arrange bond issues worth billions for 1MDB, with Malaysia claiming large amounts were misappropriated in the process and seeking $7.5 billion in redress.

Prime Minister Mahathir Mohamad, who reopened an investigation into the scandal after seizing power last year, told the Financial Times his government spurned a much smaller offer by the Wall Street titan. 

“Goldman Sachs has offered something like less than $2 billion,” he said in a Friday interview with the newspaper.

“We are not satisfied with that amount so we are still talking to them… If they respond reasonably we might not insist on getting that $7.5 billion,” he added, without providing further details.

A staff member travelling with Mahathir, who is currently in Bangkok, confirmed the premier’s remarks to AFP on Saturday. 

Last year, Malaysia filed charges against three units of the bank and two ex-employees over the scandal. 

Additional charges were filed in August against 17 current and former executives of the three Goldman subsidiaries, which the Wall Street titan later said were “misdirected”.

The news comes days after US officials said that Low Taek Jho, a central figure in the scandal, agreed to forfeit $700 million in assets as part of efforts to recover the stolen money. 

Mahathir said this week Malaysia would ask America to hand over what it has recovered from Low, in what is the largest ever US civil forfeiture. 

Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.