Goldman Sachs has entered into an agreement‑in‑principle to settle a shareholder lawsuit that accuses the bank of defrauding investors over its work with the 1Malaysia Development Berhad (1MDB) fund. The settlement, announced on April 22, 2026, will be submitted to a U.S. district judge for preliminary approval by May 20, 2026, and the terms of the settlement, including the monetary amount, have not been disclosed.
The 1MDB scandal began in 2009 when the Malaysian sovereign wealth fund was alleged to have siphoned roughly $4.5 billion. Goldman Sachs helped 1MDB issue $6.5 billion of bonds and earned about $600 million in fees. Shareholders claimed the bank misrepresented its involvement and risk management practices. In 2020, Goldman paid $2.9 billion in penalties to U.S. authorities and reached a $3.9 billion settlement with the Malaysian government. A 2022 shareholder derivative suit was settled for $79.5 million, earmarked for compliance improvements.
By agreeing to this settlement, Goldman Sachs aims to reduce its legal exposure and mitigate reputational damage that has lingered since the 1MDB revelations. The bank has previously faced criminal investigations, including a deferred prosecution agreement that ended in 2024, and the settlement is part of a broader effort to close the chapter on 1MDB‑related litigation. While the settlement amount remains undisclosed, the move signals the bank’s intent to resolve the dispute and restore investor confidence.
Goldman Sachs declined to comment on the settlement, and the lawyers representing the shareholders have not issued statements. The agreement is pending judicial approval, and no further details are available at this time.
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