## Facts

- Federal prosecutors filed a one-count criminal information in the Eastern District of New York charging The Goldman Sachs Group, Inc. with conspiracy under 18 U.S.C. § 371 to violate the Foreign Corrupt Practices Act (FCPA) anti-bribery provisions.
- The matter arose from Goldman’s role in arranging and underwriting three bond offerings for 1Malaysia Development Berhad (1MDB), raising about $6.5 billion.
- The government alleged that certain Goldman employees and agents, including senior bankers, participated in a scheme to bribe foreign officials in Malaysia and Abu Dhabi to secure and retain 1MDB-related business.
- The alleged scheme involved diversion of hundreds of millions of dollars from bond proceeds to pay bribes and kickbacks and to enrich intermediaries and corrupt officials.
- Goldman entered a deferred prosecution agreement (DPA), waived indictment, waived speedy-trial rights, and waived venue objections as to charges arising from the described conduct.
- In the DPA, Goldman admitted and accepted responsibility under U.S. law for the acts of its officers, directors, employees, and agents, and agreed that the statement of facts was true and accurate.
- Goldman agreed not to dispute the statement of facts in any later prosecution of the deferred charge; the statement would be admissible as substantive evidence if prosecution proceeded.
- The resolution included substantial monetary sanctions as part of a coordinated global resolution and imposed compliance, cooperation, and reporting obligations during the DPA term.

## Issues

1. Whether a parent corporation may be criminally charged under 18 U.S.C. § 371 for conspiring, through its officers, employees, and agents, to violate the FCPA’s anti-bribery provisions in connection with foreign business transactions.
2. Whether deferring prosecution through a DPA—conditioned on admissions, monetary penalties, cooperation, and compliance remediation—adequately addresses corporate criminal exposure and future deterrence.

## Decision

- The government filed a one-count criminal information charging conspiracy to violate the FCPA’s anti-bribery provisions.
- Prosecution was deferred under a DPA for a fixed term, subject to Goldman’s compliance with specified conditions.
- Goldman accepted corporate responsibility for the charged conduct and admitted the accuracy of an accompanying statement of facts.
- Goldman agreed to pay significant penalties as part of a coordinated global resolution.
- Goldman agreed to implement and maintain enhanced compliance controls, remediate internal control deficiencies, and report to the government during the DPA term.
- If Goldman satisfied the DPA’s conditions, the government agreed to dismiss the deferred charge at the end of the term; if Goldman breached, the government could proceed with prosecution relying on Goldman’s admissions.

## Legal Principles

- A corporation may face federal criminal liability for offenses committed by its agents when acting within the scope of their authority and, at least in part, for the corporation’s benefit, including conspiracy to violate the FCPA.
- The FCPA anti-bribery provisions prohibit corrupt payments or offers of value to foreign officials to obtain or retain business, including through intermediaries.
- A deferred prosecution agreement may resolve corporate criminal exposure by filing charges but deferring prosecution on conditions such as factual admissions, cooperation, compliance reforms, reporting, and payment of penalties.
- A DPA may include waivers of indictment, speedy-trial rights, and certain defenses, and may provide that admitted statements of fact are usable in any later prosecution if the DPA is breached.

## Conclusion

The matter was resolved through a deferred prosecution agreement under which Goldman was charged with conspiracy to violate the FCPA, admitted responsibility for agent misconduct tied to 1MDB bond transactions, accepted significant penalties, and undertook compliance and reporting obligations in exchange for deferred prosecution and potential dismissal upon full compliance.


United States v. The Goldman Sachs Grp., Inc., No. 20-CR-437 (MKB) (E.D.N.Y. 2020)