Abu Dhabi wealth fund, Mubadala Development Co, is looking to offload Falcon Private Bank, owing to fallout from the 1MDB money laundering scandal, Bloomberg has reported.
The ongoing scandal concerns the alleged siphoning of over $4.5bn from state investment fund, 1Malaysia Development Berhad, between 2009 and 2014.
This led to the toppling of former prime minister Najib Razak’s government in May last year. New primate minister Mahathir Mohamad reopened the probe into the scandal, which had been halted under Razak’s regime.
Razak now faces several criminal charges for which he could face lifetime imprisonment, but maintains his innocence.
Falcon Private Bank was embroiled in the ongoing scandal for failing to report suspicious deposits linked to 1MDB amounting to $1.27bn.
The Swiss private bank was stripped of its Singaporean banking licence and a branch manager was jailed.
Falcon has subsequently attempted to restore its image, re-branding itself as a private bank in the vanguard of digital innovation, as it sought additional areas of revenue to combat the pressures of an increasingly stringent regulatory environment.
The bank introduced direct transfers of cryptocurrencies for its private and institutional clients in January.
Mubadala, Falcon’s owners, are inviting bids for the bank’s $5bn of assets under management.
This news comes shortly after the Abu Dhabi holding company suspended business with Goldman Sachs for the US bank’s own embroilment in the 1MDB scandal. Goldman was charged by Malaysia in December 2018 for underwriting bond sales that $6.5bn for 1MDB between 2012 and 2013.