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Falcon bank fined for money laundering, ex-CEO acquitted

Earlier this year, the bank, which was set up in 1965, announced it is ceasing private banking. Headquartered in Zurich, the bank has had subsidiaries in Geneva, Hongkong and Singapore as well as representations in Abu Dhabi, Dubai and London. © Keystone/Ennio Leanza

A Swiss court has found the Zurich-based Falcon Private Bank guilty of money-laundering offences.

The Federal Criminal CourtExternal link on Wednesday ordered the Abu Dhabi-owned bankExternal link to pay a fine of CHF3.5 million ($3.8 million) for failing to set up the necessary controls. It was the first time that a Swiss bank was taken to court over accusations of money laundering.

It also has to pay CHF7 million in damages, according to a report by the Swiss news agency Keystone-SDA.

However, a former CEO of the bank was acquitted in connection with the case. The defendant was accused of helping to launder funds for Khadem Al-Qubaisi, a businessman from the United Arab Emirates, between 2012 and 2016.

The court said it could not be proved that the former chief executive knew of the criminal origin of the assets.

Sale of shares

The case centres on the illicit proceeds of the sale of shares of the UniCredit banking group worth €210 million (CHF219 million).

The Federal Administrative Court last week confirmed a five-year ban by the Swiss financial regulator on the former banker, but the verdict is still to be made legally binding.

In May, the bank announced it would cease operations, following accusations of involvement in the Malaysian 1MDB fraud case.

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