Feds investigate Goldman Sachs over suspicious 1MDB transaction

U.S. investigators are trying to determine whether Goldman Sachs Group Inc. broke the law when it didn’t sound an alarm about a suspicious transaction in Malaysia, people familiar with the investigation said.

At issue is $3 billion Goldman GS, -0.32%  raised via a bond issue for Malaysian state investment fund 1Malaysia Development Bhd., or 1MDB. Days after Goldman sent the proceeds into a Swiss bank account controlled by the fund, half of the money disappeared offshore, with some later ending up in the prime minister’s bank account, according to people familiar with the matter and bank-transfer information viewed by The Wall Street Journal.

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