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November 20, 2020

Falcon Private Bank faces criminal charges for money laundering

The Swiss attorney general has reportedly levied criminal charges against Falcon Private Bank over money laundering.

The bank has been accused of corporate misconduct for organisational deficiencies between 2012 and 2016, reported the Handelszeitung newspaper.

However, the bank has refuted the allegations.

Responding to the charges, a bank spokesperson stated: “Falcon denies the allegations made in the indictment and will defend its interests in court.”

The bank’s former CEO Eduardo Leemann has also been named in the allegations, added the report.

“The accusations of the Federal Prosecutor’s Office are unsubstantiated, completely unfounded and are completely rejected,” the spokesperson stated.

Background

Falcon came under the scanner for its involvement in the 1MDB Malaysian state fund scandal, which involved the misappropriation of over $4.5bn.

In 2016, the bank lost its licence in Singapore for its 1MDB dealings.

The Monetary Authority of Singapore (MAS) withdrew the merchant bank status of the bank for serious failures in anti-money laundering (AML) controls and improper conduct by senior management.

The private bank was also accused by Swiss financial regulator FINMA for serious AML lapses, highlighting the bank’s inability to conduct sufficient background checks into transactions and business relationships related to 1MDB.

This May, Falcon confirmed that it will cease its private banking operations in 2021.

Earlier this month, ONE swiss bank agreed to acquire the client portfolio of Falcon as part of a broader deal. The deal is said to be part of Falcon’s wind-down process.

In August, Falcon divested its fund management unit, Falcon Fund Management (Luxembourg), to Alpina Capital.

 

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