The business writers at The New York Times promise a bump in white-collar crime news in 2020. At the same time, a series of reports raises concerns about oversight of the accounting industry.
Goldman Sachs is negotiating with the Justice Department to pay a penalty of about $2 billion for its role in the 1Malaysia Development Berhad scandal, known as 1MDB.
Accounting fraud became a particular focus of the Justice Department toward the end of 2019. In December, federal prosecutors indicted executives from Outcome Health and MiMed, and opened an investigation into whether BMW, the German automaker, manipulated its sales figures.
The 1MDB case involves 17 Goldman Sachs executives accused by Malaysia of taking $2.7 billion of the $6.5 billion raised for the 1MDB fund.
How that case will be resolved is an open question because the Malaysian authorities are looking to recoup all of the money raised on behalf of 1MDB.
In the United States, federal prosecutors are looking at possible money-laundering and Foreign Corrupt Practices Act violations by Goldman.
The Times reports the money raised by the fund was to finance infrastructure and other public development projects in Malaysia. But instead, it went to pay bribes and “fuel the lavish lifestyle” of a local financier involved in the case, according to charges.Continue Reading 2020 may be a big year for white collar crime, but report cites poor oversight of accounting firms