Goldman Sachs Arrests Render Mnuchin Bitcoin Comments Useless

goldman sachs arrests bitcoin case strong

Goldman Sachs vice president and known Bitcoin skeptic Richard Gnodde is among 17 senior executives who could face ten years’ in prison for money laundering. 

Vice President Could Face 10 Years In Jail

According to a press release from Malaysia’s attorney general August 9, Gnodde is now wanted in connection with the infamous 1MDB scandal from 2013. 

According to prosecutors, Gnodde and many other top Goldman employees helped raise $6.5 billion for 1MDB, a Malaysian sovereign wealth fund, with the proceeds subsequently laundered by participants including the country’s former prime minister, Najib Razak.

Now, all could face prison sentences of up to ten years if found guilty. The release confirms:

“Custodial sentences and criminal fines will be sought against the accused… given the severity of the scheme to defraud and fraudulent misappropriation of billions in bond proceeds, the lengthy period over which the offenses were planned and executed, the number of Goldman Sachs subsidiaries, officers and employees involved and the relative value of the fees and commissions paid to Goldman Sachs for their multiple roles played in arranging, structuring, underwriting and selling the bonds.”

The charges follow on from those Malaysia brought against two other Goldman figures in December last year, also in connection with 1MDB.

In January, chief executive David Solomon issued a public apology for the role of, Tim Leissner, one of the participants in the scandal. 

“It’s very clear that the people of Malaysia were defrauded by many individuals including the highest members of the prior government,” he said at the time. 

Mnuchin: Cash Not Bitcoin Laundering ‘Not Accurate’

The latest events did not go unnoticed in Bitcoin circles, with commentators noting the irony of Goldman’s downfall just weeks after US Treasury Secretary Steven Mnuchin claimed the dollar did not play a role in “nefarious” financial activities.

“I don’t think that’s accurate at all, that cash is laundered all the time. We have the strongest AML system in the world,” he told CNBC in an interview.

On the topic of Bitcoin, also covered in the same exchange, Mnuchin had little to say, despite previous comments in which he corroborated the opinion of President Donald Trump that it is “based on thin air.”

“I don’t think [money laundering] has been successfully done with cash. I’ll push back on that,” he continued. 

“We’re going to make sure bitcoin doesn’t become the equivalent of Swiss-numbered bank accounts, which were obviously a real risk to the financial system.”

As Bitcoinist reported, Goldman is far from alone among major banks in becoming mired in money laundering scandals.

While Gnodde publicly stating his distrust of Bitcoin during its rise to $20,000 in 2017, just months later, Dutch lender Rabobank issued strongly-worded remarks about Bitcoin’s “compliance risks,” only to receive a $369 million fine for money laundering.

What do you think about the Goldman Sachs arrests? Let us know in the comments below!

Images via Bitcoinist Image Library

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