Any investor who has been following DoJ’s criminal investigation of the Vampire Squid over its alleged facilitation of the massive $4.5 billion fraud at Malaysian sovereign wealth fund 1MDB could probably have guessed that, whatever the outcome of the probe, it wasn’t going to end well for the bank.
Those suspicions have now been confirmed. Because according to a report published Wednesday by the Financial Times, Goldman Sachs could face the worst of all possible outcomes: a criminal conviction.
Though the bank has paid billions of dollars in fines stemming from its unscrupulous treatment of clients during the run-up the financial crisis, Goldman has so far managed to avoid actually being labeled a felon (some of its fellow American banking behemoths haven’t been so lucky). But now, it appears the DoJ is pressuring the bank to accept a guilty plea as part of a deal over the 1MDB case, a sign that prosecutors have rejected Goldman’s defense that the malfeasance was the result of a few bad actors (Goldman’s lead banker on the 1MDB deals, former Southeast Asia head Tim Leissner, has already agreed to cooperate against Goldman in exchange for a guilty plea). The news has sent Goldman’s shares reeling in afternoon trade, helping to drag the Dow further into the red.
That the DoJ
via ZeroHedge News http://bit.ly/2GC9KvU Tyler Durden