Trial Time
Malaysian Prime Minister Mahathir said Goldman Sachs deceived Malaysia, and the Malaysian government therefore Goldman Sachs returned to all the profits obtained by deception, with a total amount of more than $ 600 million.
Goldman Sachs is a large investment bank in the United States. In 2012 and 2013, it assisted in Malaysia's sovereign agency Yima Development Co., Ltd. (1MDB) to issue three bonds, raised a total of $ 6.5 billion in funds.Investment banks underwritten bonds for the company's institutions, and generally charges a service fee of about 4%to 5%of the total value. These three Goldman Sachs is underwriting bonds for Yima Company.$ 600 million.
If there is no greasy, why is the fee paid twice as much as the general cost?In addition, the interest rate paid by the issuance of bonds is higher than that of market interest rates, which is also an additional burden brought by Goldman Sachs underwriting bonds to Yima Company.
The U.S. Department of Justice revealed that so far, three senior executives in Goldman Sachs involved a fraud case from a company.Two of them were Tim Leissner, director of Goldman Southeast Asia, and Roger Ng, a Roger Ng of Roger Ng, a subordinate Malaysian in Singapore.Huang Zonghua has been detained by the Malaysian police for 60 days, waiting for the US Department of Justice to go through the formalities and extract him to the United States for trial.
Lesner has admitted that he bribes Malaysian officials to obtain the business of underwriting bonds.Because Yima's issuance of bonds was greasy, he was able to take the opportunity to charge high service fees, of which about 200 million US dollars flowed into the company controlled by his and relatives.
The Malaysian government is recovering the cost of US $ 600 million paid to Goldman Sachs, and Goldman Sachs compensates for losses that the bond interest rate is higher than the market interest rate.Lesner has agreed to return the illegal income he has obtained from Yima Company nearly $ 43.7 million; Huang Zonghua has also agreed to return S $ 40 million in illegal income, and his amount has been frozen by the Singapore government.Liu Tezuo, who was the master of bribery and black money laundering, is still fleeing.
As mentioned above, the US Department of Justice revealed that three executives in Gaosheng involved the fraud case of Yima Company.In addition to Ricener and Huang Zonghua, who is the third?The US Department of Justice did not disclose.However, from the information collected, this person is likely to be Goldman Sachs's current chairman of Llayd Blankfein. According to Bloomberg reported earlier this month, Brank Fien met with former Malaysian Prime Minister Najib in 2009. ThenThe meeting laid the foundation for the relationship between the two.
And Blank Fien was confirmed that at a meeting of Ricener and Liu Tezuo, some people even said that he was the mastermind of the disadvantages of Goldman Sachs and Yima Company.Blank Fien was originally the chief executive of Goldman Sachs. If he really involved a disadvantage of a company, Goldman Sachs, as a big international investment bank, made people completely lose confidence in it. Do you say it is terrible?
The Basel Commission divides the risks of financial institutions into eight categories. In addition to credit risks and market risks, there is also a type of risk called reputation and risk, which means that if a bank does it illegally and illegally, the reputation will inevitably affect its camp.Receive and profit.However, this is not used for international investment banks. Although the reputation is damaged, even the notorious, the investment bank is still popular in business, and it is still full of money. Why?Because they monopolize the investment banking business with extremely large income.
In the past four years, from 2014 to 2017, Goldman Sachs' profits were US $ 8.1 billion, $ 5.6 billion, $ 7.2 billion, and $ 3.7 billion, which is rich in profitability.Last year, the bank's stock options were exercised, with a profit of about 5 million US dollars.
Goldman Sachs had a lot of violations of regulations. The two most famous things were probably to assist the Greek government to deceive the EU that year and fraud during the US subprime mortgage crisis.
In 2002, when the Greek government applied to enter the European Union as a member country, the European Union stipulated that member states must control the government's fiscal deficit to control the GDP and control within 3%. The ratio of debt must be controlled within 60%.The Greek government's fiscal deficit and debt did not comply with the European Union's regulations, so Goldman Sachs made suggestions to the Greek government to reduce the rate of debt in Greece.
Goldman Sachs transformed many of Greece's original debt into currency swap contracts, because currency swap contracts are a derivative product, which is not recorded in the balance sheet (inside the table). It is outside the balance sheet (outside the table)Projects, so it is not liabilities.Goldman Sachs greatly reduced the ratio of Greek debt and enabled Greece to successfully join the European Union, but it led to a serious Greek debt crisis that was later.
Goldman Sachs has made a lot of money through this consulting service and selling monetary exchange contracts to the Greek government, with a revenue of as high as one billion US dollars.However, because Goldman Sachs's approach is immoral, but it is not illegal, it is not punished by law.
The second scandal was during the US subprime mortgage crisis.This incident has become a classic case of university finance, named Goldman Sachs and CDO.During the US subprime mortgage crisis in 2007, when the U.S. real estate market fell into a recession, it deliberately launched a complicated structural debt certificate (CDO), and the largest hedge fund Paulson (PaulsonCO), carefully planning the layout, fraudulently many investors.
In 2010, the US Securities and Exchange Commission accused Goldman Sachs accusing Goldman Sachs of deceiving and concealing investors on many key issues. As a result, investors lost more than $ 1 billion.In 2016, Goldman Sachs was fined a huge amount of $ 5.06 billion.The US subprime mortgage crisis directly led to the occurrence of global financial turmoil in 2008.
There are many examples of Goldman Sachs illegal and illegal. For example, it was fined US $ 120 million for the control rate; it was fined 50 million US dollars for illegal use and leaking the Fed's secret supervision information;There are shortcomings in Goldman Sachs, and failed to provide correct information, that is, Goldman Sachs concealed key information.
There is also a Director of Goldman Sachs fined nearly $ 100 million for participating in insider transactions. In addition, Goldman Sachs traders were fined $ 110 million during online chat.
In fact, not only Goldman Sachs is so, almost all international investment banks have been made by relevant regulatory authorities because of improper behavior, and some tickets are even as high as US $ 10 billion.In addition, investment banks also have many behaviors. Although they are not illegal or not, they are immoral and have not been punished by the relevant authorities.
The author is Xiamen University, China
Professor of the School of Accounting and Finance of Jiageng College
