By Elizabeth

(The writer is a legal practitioner in Malaysia)

People will try anything to look good after the fact….

I read with some amusement the headlines arising from the former Attorney General Tommy Thomas and related statements from Lim Guan Eng, C4 , et al claiming that the deal with Goldman Sachs was rushed and premature, that Malaysia had a very strong case against them, and that there was plenty of bargaining power.

Oh really?  Why was it then that he failed to close his negotiations with Goldman Sachs and could only reach the paltry sum of $1.9 billion in his negotiations?  Why did the negotiations stall out and go nowhere, left with the figure that Goldman Sachs left on the table without heavy pressure for them to lift the offer to settle out?

If the case was that strong, surely Goldman Sachs would have been more incentivised to come to the table with a higher offer than they did?

My personal view is that the case just wasn’t there.  Look at the timing – he was appointed in July 2018, with charges appearing by November and December the same year.  That is a very short lead time for a thorough investigation to commence and be concluded to the point of supporting charges in such a matter.  Investigations of this type typically take a significant amount of time to prepare properly – just look at the 1MDB, SRC and other similar matters as a comparison.  Yet charges were laid in only 4 to 5 months?  And negotiations stalled without any real incentive for Goldman Sachs to avoid such a “slam dunk case” with the supposed embarrassment and expense that should be expected of going through a hearing with such a strong case?  I don’t think so.

Remember, as in other matters, there are always some media releases on progress and actions underway, as there were in the 1MDB and SRC matters.  Not this time.  There was also a cross-border element – this invariably stretches a matter well beyond the 5  months time-frame on this case.  Yet Tommy claims he had a very strong case ready for trial after only 5 months??

Who was tasked to investigate and gather the evidence? Was it the MACC, Police, Securities Commission?  There was absolutely no information provided as to the ongoing investigation as there always is – so who was doing it? I would suggest that these circumstances point to the fact that there was no-one conducting the investigation, and that Tommy did not in fact have a “very strong case” or any real case at all – which is why his negotiations fell over.

This could be the reason why Minister Zafrul made the following remark : “…the current Attorney-General Tan Sri Idrus Harun secured a settlement after intimating to Goldman Sachs of amended and new charges for fraud under Section 179 (a) and civil disgorgement claims under Section 199 CMSA. These entitled Malaysia to disgorge three times the fees (US$606 million x 3 = US$1.818 billion) earned by Goldman Sachs. These statutory claims are more robust and irrebuttable and resulted in the settlement. The US$2.5 billion cash payment is 42% more than the offer received before.”

This leads me to my stated belief as shared previously – that the current Attorney General, Idris Harun had very little to work with, could see a train wreck coming in the Courts, and worked to obtain a very impressive and pragmatic result higher than that sought by the US Department of Justice.

It is very easy for the former AG and others to sit back and criticise the efforts of the current AG, however it must be remembered that he did not get anywhere by way of settlement, and was recklessly allowing the matter to drift into a costly Court Hearing with what I suggest was a weak case.

One thing that is also apparent from all their statements is that they are somewhat delusional in thinking that Goldman Sachs can be easily fooled into a settlement by merely laying criminal charges against them!! These people need to wake up!! Even the US DOJ is attempting to settle the matter out of court and what makes these people think they have “super powers” to force Goldman Sachs into a settlement!!

Stop criticising and recognise the efforts that have gone into the settlement – Tommy had the chance to do better and failed.  If it was such an obtainable win, where was his win?  The circumstances speak for themselves – a failed attempt to not close a $1.9 billion settlement compared with a $3.9 billion successful settlement – no thanks to the former AG, thank you very much.