Primus Pacific Partners, a private equity firm and the largest shareholder in Malaysian bank EON Capital, filed suit against Goldman Sachs for $510 million for fraud and breach of fiduciary duty. The suit goes against Goldman as the bank is being sued by a shareholder of one of its former clients over alleged fraudulent misrepresentations that involve links to the prime minister of Malaysia, Najib Razak. The suit claimed Goldman concealed a conflict of interest involving the Prime Minister while the investment bank was acting as financial adviser to EON, which was weighing a takeover bid by Hong Leong Bank. Talks on the deal began in 2009 but the bid was held up until 2011 as Primus fought the offer in Malaysia’s courts. One of the prime minister’s brothers, Nazim Razak, was a director at Hong Leong Bank, and another brother, Nazir Razak, was chairman of CIMB Group, which advised Hong Leong Bank on the bid. At the same time, Goldman was an adviser to 1Malaysia Development Berhad, also known as 1MDB, a development fund established by the prime minister. In a response to the suit, Goldman Sachs pointed out that Primus had already failed to block the deal.
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