Goldman Sachs has slashed the annual pay of its CEO David Solomon as a punitive measure for the bank’s role in the 1MDB scandal.

The pay cut reduced his package by nearly 36% to $17.5m in 2020 from $27.5m a year ago, according to regulatory disclosures.

Earlier, Goldman announced that it also trim annual packages of its chief financial officer Stephen Scherr and chief operating officer John Waldron.

Waldron will now receive $18.5m for his work last year, while Scherr’s package was revised to $15.5m. Both the salaries are down by 24% and 31%, respectively, from the previous year.

Reuters reported that had it not been for 1MDB scandal, Solomon and Scherr’s pay would have remained unchanged, while Waldron’s salary would have increased by $1m.

1Malaysia Development Berhad (1MDB) is an insolvent Malaysian strategic development company accused of money laundering.

Goldman bankers paid more than $1.6bn in bribes between 2009 and 2014 to win 1MDB business. The company also allegedly helped 1MDB in raising $6.5bn through bond sales.

In August 2020, Goldman Sachs finalised a $3.9bn agreement with the government of Malaysia to settle all allegations.

Also, Malaysia’s former Prime Minister Najib Razak was sentenced to 12 years of imprisonment last year in relation to the scandal.

Recently, Goldman Sachs posted a 153% year-on-year surge in Q4 2020 net earnings.

In Q4 2020, total net revenues amounted to $11.74bn, up 18% from $9.95bn reported in the same quarter a year ago.