- Malaysian fund probed over possible financial irregularities
- Falcon in contact with regulators and says being cooperative
Falcon Private Bank AG, owned by Abu Dhabi’s Aabar Investments PJSC, said it has nothing to hide from regulators probing possible financial irregularities at a Malaysian state investment fund and is cooperating fully with investigators.
"We are totally transparent, fully cooperative and there’s nothing to hide," Falcon Chief Executive Officer Eduardo Leemann said Wednesday in an interview in Dubai, saying the bank’s business hasn’t been affected by the investigation. "We’re open as a book. That’s all I can say.”
Falcon is caught up in an investigation stretching from Switzerland to Malaysia to the U.S. into whether money might have flowed out of the 1Malaysia Development Bhd., known as 1MDB, started by Malaysian Prime Minister Najib Razak seven years ago, and illegally into personal accounts. Falcon held accounts for key 1MDB entities in Hong Kong, the Sarawak Report blog said earlier this month, and helped transfer money from the fund, it said.
The Malaysian government, without giving any details, has previously tried to discredit the Sarawak Report, saying e-mails it used as the basis for some of its reports may have been tampered with.
Swiss authorities have also investigated transactions tied to the fund that were made using Falcon, the Wall Street Journal reported in December, citing people with knowledge of the matter.
The Zurich-based wealth manager is "constantly in contact" with authorities around the globe and is "100 percent cooperative,” Leemann said.
Falcon is owned by Abu Dhabi’s Aabar. A 1MDB unit transferred at least $850 million via three transactions to a British Virgin Islands-registered company “Aabar Investments PJS Ltd.” which closely resembles the name of International Petroleum Investment Co.’s wholly-owned subsidiary Aabar Investments PJS, the Journal also reported. Aabar and IPIC "don’t have a view on the investigation," Leemann said. "I don’t talk to them about this." Aabar didn’t immediately return calls and an e-mailed request for comment.
Malaysian investigators ended a graft investigation into Najib in January, clearing him of any wrongdoing over a "personal contribution" of $681 million from Saudi Arabia’s royal family in early 2013 before a general election. The probe found that Najib, who has denied taking any money for personal gain, returned $620 million in August 2013.
Aabar paid 307 million Swiss francs ($306 million) and assumed 100 million francs in debt to take over Falcon from AIG in 2008 after the New York-based insurer sold assets, including life and retirement services and a plane lessor, to repay a U.S. government loan that saved it from bankruptcy.
(A previous version of the story was corrected to fix a spelling error of a company name.)