London’s High Court found US investment bank Goldman Sachs not guilty of knowingly misleading Libya’s state fund into bad investments. The court announced its ruling on Friday.
In a 120 page ruling, Justice Vivien Rose said the Wall Street bank “did not go beyond the normal cordial and mutually beneficial relationship that grows up between a bank and a client.”
In addition, the judge said that, “given the nature of the trades and the work that had gone into winning them” the earnings that Goldman made from the trades were reasonable.
The Libyan Investment Authority (LIA) sued Goldman for over $1 billion to compensate for their losses from their investments.
Overthrown Libyan dictator Muammar Gaddafi formulated the LIA to manage Libya’s oil revenue in 2006.
The LIA accused Goldman Sachs of manipulating its officials into trades using extravagant vacations that the bank offered to LIA officials and their family members.
Goldman denied the claims made by the LIA saying the state fund was more than capable of understanding the deals it was making.
Referring to the investments suggested to LIA by Goldman, Justice Rose said “there were other reasons why the LIA wanted to enter into them and, if they were unsuitable, they were no different from many other investments that the L.I.A. made over the period in that regard.”
In a statement, the Libyan state fund said it was “disappointed” by the ruling adding that “time will be needed fully to digest the judgment and all options are being considered at this time.”
Goldman also released a statement expressing its appreciation for the court’s ruling. “We are pleased to win this case, with a comprehensive judgment in our favor,” said the statement.
