Goldman Sachs and Libya
Posted: Wed Jun 29, 2016 9:19 pm
You can't make this stuff up.
http://dealbreaker.com/2016/06/libya-in ... man-sachs/
"Hey, remember that court case going on in London involving Goldman Sachs and the Libyan Investment Authority, the latter of which claims the former took advantage of it vis-à-vis nine equity derivatives trades, costing the LIA $1.2 billion and scoring Goldman Sachs a profit of $222 million?
That a Goldman Sachs banker, Youssef Kabbaj, supposedly “embedded” himself with LIA employees, allegedly plying them with “expensive entertainment and stylish hotels,” a holiday to Morocco, a “highly coveted” Goldman internship for the brother of a “key decision maker at the LIA,” and, of course, prostitutes.
That Goldman bankers allegedly went after the LIA like a swarm of killer bees, making an ex-LIA consultant feel “almost under attack as different Goldman Sachs teams and products were presented to me, one after the other and almost relentlessly, without me even being given the opportunity to ask questions or reflect on them.”
Today, lawyers for the LIA attempt to stress just how financially naive they mean when they say financially naive. Turns out the answer is: really friggin’ financially naive.
Catherine McDougall was temporarily transferred to the LIA by London-based law firm Allen & Overy for six weeks in July and August 2008. She told the High Court on Tuesday that after arriving in Tripoli she was surprised to learn that the Libyan fund managers didn’t understand the trades they had entered into with Goldman. “There was a sea of confusion at the LIA, which ranged from an understanding that they had purchased shares, quasi-shares or shares with deferred payment,” Ms. McDougall said. “I was really surprised as it did not take rocket science to realize that the product was completely synthetic,” she said. “There were no shares involved.” The cash-based trades were tied to movements in the share prices of companies including Citigroup Inc. but didn’t confer ownership of the shares."
But wait...it gets better:
http://www.wsj.com/articles/libyan-fund ... 1467150387
"Goldman’s relationship with the LIA finally broke down in a “stormy meeting” in Tripoli on July 23, 2008, which Ms. McDougall said she attended along with Goldman bankers including Mr. Kabbaj and LIA officials. During the meeting, Mr. Zarti said that Goldman had “screwed” the LIA, according to Ms. McDougall.
“He launched into a very angry tirade, saying that he had a bad side as well as a good side and that he could come after their families,” she wrote in her statement. “Mr. Kabbaj’s face became white in shock.” Mr. Zarti then cursed Mr. Kabbaj in English, she said.
Mr. Kabbaj no longer works at Goldman and isn’t due to testify in court. In his June 13 email to The Wall Street Journal Mr. Kabbaj referred to a November 2008 letter sent by law firm Withers to Goldman on his behalf. The letter has been disclosed in court.
The letter said that during the July 23, 2008, meeting in Tripoli, Mr. Zarti called Goldman “a bank of Mafiosi” which had lied to him about the trades. “I can make you disappear and nobody will ever hear back from you,” Mr. Zarti told Mr. Kabbaj, according to the letter. A spokesman for Mr. Zarti declined to comment on the court case.
Following the meeting, Mr. Kabbaj met with senior Goldman banker Andrea Vella to discuss what to do, according to the letter. Mr. Vella was “in the background of all the trades and was effectively in charge of the day-to-day commercial relationship,” the letter said. The letter demanded that Goldman pay Mr. Kabbaj a $9 million “guaranteed bonus” otherwise legal proceedings would be commenced against the bank. Goldman agreed to pay Mr. Kabbaj $4.5 million, court documents show."
Don't worry, business as usual.
