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The reforms were agreed upon in 2013 after the Fed pressed Goldman to be more transparent, but weren’t publicly disclosed.
Monday 26, November 2018
(Bloomberg)--Goldman Sachs Group Inc. was told by regulators to tighten its risk oversight and increase reports of internal debates about deals just after the bank completed $6.5 billion of bond financing for 1MDB, the Malaysian fund, the Financial Times reported.
Goldman implemented changes to the internal committees that oversee how its operations work, under pressure from the New York Federal Reserve, according to the newspaper. The reforms were agreed upon in 2013 after the Fed pressed Goldman to be more transparent, but weren’t publicly disclosed, the paper reported.
The New York Federal Reserve told the newspaper it couldn’t discuss its supervision of individual banks. Michael DuVally, a spokesman for Goldman, couldn’t immediately be reached for comment on Sunday.
At least three Goldman bankers were implicated by the US Department of Justice in a multiyear criminal enterprise that included bribing officials in Malaysia and elsewhere and laundering hundreds of millions of dollars.
The changes, which included rewriting of the charters of Goldman committees that approved three 1MDB bonds, were not directly linked to those deals, according to the FT. They resulted from a wider questioning of controls, including concerns that committee minutes didn’t record debates in sufficient detail, the paper reported.
Goldman Chief Executive Officer David Solomon said in a Bloomberg TV interview earlier this month that he felt “horrible” about the role former bank employees played in the scandal surrounding the 1MDB fund.