FOR IMMEDIATE RELEASE
Wednesday, July 1, 2020
Contact: Pamela Russell at 202-618-6433 or prussell@bettermarkets.com
Washington, D.C. – Dennis M. Kelleher, President and Chief Executive Officer of Better Markets, issued the following statement in response to reports that Goldman Sachs Group Inc. and the Department of Justice are close to a deal that would allow the bank to avoid appropriately severe penalties for its criminal conduct regarding 1Malaysia Development Berhad or 1MDB:
“Goldman Sachs’ years of criminal activity involving 1MDB are so egregious that they shock the conscience and merit the most severe punishment. Not only did Goldman’s reported actions enable the looting of an entire country, but they undermined and corrupted the country’s democracy and involved the deaths of several people, including a prosecutor who was brutally murdered investigating the 1MDB crimes. The reported negotiated settlement involving a $2 billion fine and ‘guilty’ plea from one of its Asian subsidiaries would be grossly inadequate for crimes that touched the highest levels of the bank. It will not punish or deter Goldman Sachs or other criminals.
“Moreover, these latest crimes must be considered in light of Goldman’s egregious, decades-long record as a recidivist lawbreaker. Its RAP Sheet shows that it has been involved in more than 36 major legal actions that have resulted in almost $10 billion in fines and settlements over the last two decades. Prosecutors and regulators would have put any other company, much less a major bank, with that record of repeated illegal conduct out of business a very long time ago.
“On the reported facts and merits and given its recidivist history, there seems little doubt that any settlement with Goldman should include a guilty plea to criminal charges by the bank holding company, a fine of more than $5 billion, disgorgement of every penny from its many 1MDB activities, the imposition of a truly independent monitor, limitations on collateral activities, and personal monetary penalties and industry bars on the materially involved executives and officers, not just the three fall guys already identified.
“If the Department of Justice does less, it will once again show that Wall Street’s biggest, wealthiest, most politically connected banks are still too-big-to-jail, no matter how many crimes they commit, how many laws they break, how many victims there are or how much damage they inflict. Given that the Attorney General and other senior Department of Justice officials making the decisions regarding 1MDB had to get waivers from conflicts of interest and that Goldman has hired a former Department of Justice prosecutor to negotiate a deal for it, the Department of Justice should be particularly careful not to appear to be giving a connected Wall Street bank special and favorable treatment.
“In light of the social and political upheaval in the streets of the country today, such special treatment would yet again confirm the indefensible double standard of justice in the U.S.: one for Main Street Americans and every business in the country that get meaningfully punished when they break the law and one for the biggest, richest, politically well-connected banks on Wall Street that get one sweetheart deal after another. This case, given the shocking facts and the involvement of more than 30 Goldman executives, including the CEO, should be the one where that double standard is ended.”
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Better Markets is a non-profit, non-partisan, and independent organization founded in the wake of the 2008 financial crisis to promote the public interest in the financial markets, support the financial reform of Wall Street and make our financial system work for all Americans again. Better Markets works with allies – including many in finance – to promote pro-market, pro-business and pro-growth policies that help build a stronger, safer financial system that protects and promotes Americans’ jobs, savings, retirements and more. To learn more, visit www.bettermarkets.com.
