ZURICH (REUTERS) – A court acquitted the former chief executive of a Swiss private bank but fined the now-defunct lender 3.5 million Swiss francs (S$5.2 million) on Wednesday (Dec 15) for helping a Gulf businessman launder money to buy luxury property and cars.

Mr Eduardo Leemann, 65, had denied prosecutors’ allegations that as CEO of Falcon Private Bank, he helped launder €133 million (S$205 million) in illicit proceeds between 2012 and 2016.

He was also accused of making payments of €61 million to help the businessman maintain a high roller’s lifestyle complete with fast cars and expensive foreign properties.

Prosecutors said the funds came from a deal the businessman had put together to sell shares he covertly held in Italian bank UniCredit at an inflated price to Aabar, an Emirati investment firm where he worked.

The Swiss Federal Criminal Court said it could not be proved that Mr Leemann knew of the criminal origin of the assets, and he was therefore acquitted of money laundering.

But it found that the bank had breached compliance regulations and did not have sufficient internal guidelines in place to prevent money laundering.

Aabar’s Luxembourg arm was a private plaintiff in the case.

Falcon gained global prominence in 2015 after it was reported that investigators found nearly US$700 million (S$956 million) had been transferred from an account at the bank’s Singapore outpost to accounts in Malaysia linked to then Prime Minister Najib Razak.

Swiss watchdog Finma found in 2016 that Falcon violated money laundering regulations by failing to carry out adequate background checks into transactions and business relationships associated with state fund 1Malaysia Development Berhad.

Falcon, owned by Abu Dhabi state fund Mubadala Investment Company, wound itself down last year.