KUALA LUMPUR: Malaysia reached a $3.9 billion settlement with Goldman Sachs Friday over the Wall Street titan's role in the 1MDB scandal in exchange for the country ending all criminal proceedings against the bank. Billions of dollars were looted from sovereign wealth fund 1Malaysia Development Berhad in a fraud that allegedly involved former prime minister Najib Razak and his cronies.

The cash plundered from state coffers bankrolled a global spending spree, and was spent on everything from artwork, to real estate and a super-yacht. Goldman's role came under scrutiny over bond issues totalling $6.5 billion it helped arrange for the investment vehicle, with Malaysia claiming large amounts were misappropriated during the process.

Najib lost power in 2018 amid public anger at the scandal, and a new government charged Goldman and a string of former and current employees over the fraud, as well as demanding hefty compensation. Malaysia and Goldman had been locked in long-running talks, and the country's finance ministry announced a breakthrough had finally been achieved.

The settlement comprises a cash payment of $2.5 billion to Malaysia and a guarantee that at least $1.4 billion in assets acquired with misappropriated funds would be recovered, it said. "This settlement represents assets that rightfully belong to the Malaysian people," Finance Minister Tengku Zafrul Abdul Aziz said.

"We are confident that we are securing more money from Goldman Sachs compared to previous attempts, which were far below expectations." Prime Minister Muhyiddin Yassin hailed a "victory" and said that, combined with 1MDB-linked funds already returned to Malaysia by the US, the country will receive a total of $4.5 billion.