Falcon exits Swiss private banking after 1MDB scandal
Falcon is offering a social plan to staff who will lose their jobs.
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The Abu Dhabi-owned Falcon private bank says it is winding down activities in Switzerland and is in talks with a Swiss rival to take on its existing clients next year. Falcon was taken to task by regulators in both Switzerland and Singapore for its role in channelling assets from the Malaysian 1MDB fraud.
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The company says it has changed its name to “Falcon Private” but will remain under the supervision of the Swiss Financial Market Supervisory Authority (FINMA) while it hands over its private banking clients and assets to the unnamed bank.
“Three years ago, we gave Falcon Private Bank a new profile through innovative ideas and unconventional solutions. However, after a strategic review and evaluating various options, we have concluded that, especially in the current environment, the controlled cessation of Falcon’s banking activities is the best way to protect the interests of our stakeholders,” stated chairman Roberto Grassi on MondayExternal link.
Falcon, which is owned by the United Arab Emirates sovereign wealth fund Aabar, ran into regulatory trouble several years ago surrounding the corrupt Malaysian wealth fund 1MDB. In 2016, it was stripped of its banking licence in Singapore and ordered by FINMA to hand over CHF2.5 million ($2.6 million) in illegally obtained profits.
Last year, the bank lost its appeal against the FINMA verdict. Now Falcon is exiting the private banking business in Switzerland and expects job losses as a result.
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