[dm3730]

Perhaps it would help if we clarified some terms first. "An underwriter is the party that evaluates and assumes another party's risk for a fee, such as a commission, premium, spread or interest.". Note, the part about taking on the risk. GS underwrote the huge 1MDB bond, but allegedly in cahoots with corrupt individuals, while allegedly intentionally ignoring red flags (raised by their own internal compliance department) and then knowingly passing all the risk and subsequent losses to the Malaysian tax payers.

> 7.5 Billion is almost 10% of the entire company's shareholder equity, truly a staggering sum for GS to pay.

Apparently the 1MDB losses have cost Malaysian taxpayers around USD $12 billion. Given that GS was the underwriter and allegedly the key enabler of the scandal, punishing GS by making them pay at least the majority of those taxpayer losses seems unjustified or unfair to you? What amount do you believe is fair?

For example, if a "fence" helps a thief sell off some "gear" and the thief is caught. How much should the "fence" be liable for? How much should the victims get back?

[benmmurphy]

In a bond issue i think the underwriter normally promises to buy securities if they are not sold and evaluates the risk for potential buyers. I'm not sure what claim the Malaysian tax payer has. Maybe Malaysia should default on all these bonds and then hope the people that bought them from GS sue GS if they want to punish GS.

[theosp]

Where the $12 billion figure is coming from? $6 billion is what GS raised. Also, not all the said $6 billion disappeared.

[edit: added 'Also, not all the $6 billion disappeared']

[dm3730]

> Where the $12 billion figure is coming from?

Wikipedia. https://en.wikipedia.org/wiki/1Malaysia_Development_Berhad_s...

"According to its publicly filed accounts, 1MDB has nearly RM 42 billion (USD 11.73 billion) in debt"

The Malaysian taxpayer got finangled into guaranteeing all of that debt allegedly by GS.

[theosp]

Well, "it is stated that at least US$3.5 billion has been stolen from Malaysia's 1MDB state-owned fund" (https://en.wikipedia.org/wiki/1Malaysia_Development_Berhad)

Even if guilty, what GS has to do with any debt beyond what it raised for 1mdb (us$6b)?

You write: "Given that GS was the underwriter and allegedly the key enabler of the scandal, punishing GS by making them pay at least the majority of those taxpayer losses seems unjustified or unfair to you? What amount do you believe is fair?"

But from reading the first paragraph under the History section here:

https://en.wikipedia.org/wiki/1Malaysia_Development_Berhad

it is clear that by the time Goldman started raising money for 1mdb (2012 if i am not mistaken), a lot of money been raised already, i.e. GS wasn't the key enabler.

So why blame Goldman for all the debt accumulated under 1mdb?