Malaysia has charged 17 former and current Goldman Sachs bankers – including Richard Gnodde, the most senior banker in London – over the corruption investigation at its state development fund 1MDB.
Attorney General Tommy Thomas said custodial sentences and criminal fines would be sought against those charged.
Goldman helped raise $6.5bn (£5.4bn) through bond offerings for 1MDB.
The bank said it would “vigorously” defend the charges.
Mr Thomas said in a statement : “Custodial sentences and criminal fines will be sought against the accused.”
He said this was because of the “severity of the scheme to defraud and fraudulent misappropriation of billions in bond proceeds, the lengthy period over which the offences were planned and executed, the number of Goldman Sachs subsidiaries, officers and employers involved and the relative value of the fees and commissions paid to Goldman Sachs for their multiple roles played in arranging, structuring, underwriting and selling the three bonds”.
If convicted, those charged could face prison sentences of up to 10 years and fines of at least one million ringgit (£200,000).
In December last year, Malaysia filed criminal charges against Goldman Sachs and two former employees in connection with the corruption and money-laundering investigation at the fund, which is being investigated in at least six countries.
“We believe the charges announced today, along with those against three Goldman Sachs entities announced in December last year, are misdirected and will be vigorously defended,” a spokesperson for Goldman said.
Among the other individuals named by Malaysia’s attorney general are Michael Sherwood, a former co-head of Goldman’s European operations, and Michael Evans, a former partner who is now president of Chinese e-commerce company Alibaba.
The charges related to what is being seen as one of the world’s biggest financial scandals.
US and Malaysian prosecutors have previously said that the money raised by the state fund went to line the pockets of a few powerful individuals and to buy luxury properties, a private jet, Van Gogh and Monet artworks – and to finance a Hollywood blockbuster, The Wolf of Wall Street, starring Leonardo DiCaprio, who has not been accused of any wrongdoing
These charges have been brought under the under a section of the Malaysian Capital Markets and Services Act that holds certain senior executives responsible for any offences that may have been committed.
In December, Malaysia filed charges against Goldman Sachs and its former bankers, Tim Leissner and Roger Ng.
Mr Leissner was Goldman’s South East Asia chairman, and left the bank in 2016. Mr Ng was a managing director at Goldman until his departure in May 2014.
At the time, charges were also filed against local financier Low Taek Jho, also known as Jho Low who maintains his innocence, and former 1MDB employee Jasmine Loo Ai Swan.
Mr Leissner has pleaded guilty in the US to conspiring to launder money and violating anti-bribery laws.
Thomas Cook’s German subsidiary has announced it is filing for insolvency in an attempt to save its national brands after the collapse of the UK parent company on Monday.
Almost 100,000 holidaymakers are travelling with the German affiliates and it is not clear what the bankruptcy proceedings will mean for them.
The German government has already granted a €380m (£335m; $420m) bridging loan to the holiday airline Condor.
Condor is 49% owned by Thomas Cook.
The central state of Hesse, where Condor is based, also stepped in to rescue the airline, arguing that it was profitable.
The company said it was “operationally healthy” and the six-month loan was aimed at preventing any “bottlenecks” resulting from its British parent company. The funding will be paid out pending an agreement with the European Commission.
Thomas Cook Germany is also based in Hesse and state premier Volker Bouffier said it was in principle willing to step in to help that company too.
It said that it had long been burdened by the weak Thomas Cook business in Great Britain and by Brexit.
How are European tourists affected?
A total of 600,00 holidaymakers have been caught up in the collapse of the UK company. Many have travelled from the UK but Thomas Cook’s empire stretches across Europe and tens of thousands have travelled with its subsidiaries.
Under EU package holiday rules, holidaymakers are protected financially from a company’s insolvency as well as having the right to repatriation.
The UK’s Civil Aviation Authority has had the task of bringing back more than 150,000 holidaymakers. It repatriated more than 14,000 passengers on Tuesday and was expecting to bring back another 16,500 on Wednesday.
Thousands of Dutch, Belgian and Polish tourists are still abroad, but the biggest group affected outside the UK is from Germany. A spokeswoman said on Wednesday that 97,000 people were currently travelling with the company.
Thomas Cook Germany employs some 2,000 people and has several national brands, including Neckermann, Öger Tours, Air Marin and Bucher Reisen. A thousand people are employed by the company near Frankfurt.
It said it was talking to the German foreign ministry as well as the travel bankruptcy insurer, Zurich, about repatriating customers. Like Condor, it has asked the Hesse state government and the federal government for a bridging loan.
Why has Germany’s Thomas Cook filed for bankruptcy?
The German subsidiary believes its brands have a future and is in negotiations with investors and hotel operators to continue in business.
Thomas Cook GmbH said it had been forced to seek insolvency to extricate itself from its (UK) parent company’s “financial tie-ups and related liabilities”.
“We owe this to our long-standing customers, committed employees and other partners who have supported us so much over the years and in the last difficult weeks,” said chief executive Stefanie Berk.
Thomas Cook businesses in several other European countries are also trying to survive:
- Polish subsidiary, Neckermann Polska, has suspended its activities and said it will file for bankruptcy
- Thomas Cook Netherlands, which has 10,000 holidaymakers abroad, said on Wednesday it had been granted a delay on payments while action was taken to secure its future
- Thomas Cook France has more than 9,600 customers abroad and will go to court on Thursday in an attempt to go into receivership and find a buyer
- Thomas Cook Austria has filed for bankruptcy and has almost 5,000 customers abroad.
Founded in 1841, parent company Thomas Cook filed for bankruptcy after failing to secure emergency funding of £200m from the UK government.
In the UK, anyone who has bought a package holiday covered by the Air Travel Organiser’s Licence scheme (Atol) will have the cost refunded.
However, some customers whose future holidays have been cancelled have seen the price of replacement deals spiral.
House prices and sales are “losing momentum” amid Brexit uncertainty, surveyors say, although parts of the UK are still seeing property values rise.
Key aspects of the housing market were “pretty much flatlining”, the Royal Institution of Chartered Surveyors (Rics) said.
Many homes valued at more than £1m were being sold for under the asking price.
However, it said prices in Scotland, Wales and Northern Ireland were rising at a “solid pace”.
This tends to be good for owners and sellers in these nations, but more of a headache for potential first-time buyers.
Rics said 69% of property professionals said sale prices were lower than asking prices for homes marketed at more than £1m, although asking prices for homes priced at £500,000 or less appeared to be holding up more firmly.
House prices continued to fall in London – where a higher proportion of £1m homes are sold, the South East of England, and East Anglia.
Overall across the survey, a net balance of 9% of surveyors reported house prices falling rather than increasing. Surveyors’ expectations for house sales in the next few months were flat, with an increasing proportion expecting prices to fall, the survey showed.
Simon Rubinsohn, Rics chief economist, said that the UK-wide picture provided “little comfort for the market”.
“The forward-looking metrics on prices and sales also seem to be losing momentum as concerns, clearly voiced in the anecdotal feedback – both about Brexit and political uncertainty – heighten,” he said.