UBS is caught up the burgeoning scandal surrounding Malaysian state fund 1MDB, according to a investigative blog. The Swiss bank may have helped funnel billions in government cash to private hands.

Sarawak Report, founded by former BBC journalist Clare Rewcastle Brown, reported that hundreds of millions of 1MDB funds were channelled to a British Virgin Islands subsidiary in 2014 by Banca della Svizzera Italiana, or BSI, as well as by UBS.

The blog published what it claims are excerpts of bank statements illustrating that payments of $2 billion from 1MDB flowed through an account with UBS in Singapore en route to an account held by Aabar Investment. Aabar is allegedly a sham entity set up by associates of Malaysian Prime Minister Najib Razak (pictured below).

finews.ch couldn't independently verify Sarawak Blog's reporting. A spokesman for UBS' private bank in Zurich wasn't immediately available for comment.

Sarawak 500 

Official Muscle

Whether UBS is involved in 1MDB or not, the Swiss bank cannot ignore the growing scandal. BSI was sent hidebound from Singapore by the local regulator after its dealings with the state fund were examined by Swiss and Singaporean investigators.

Besides BSI, several other banks including Zurich's Falcon Private Bank, Luxembourg's branch of Banque Edmond de Rothschild and Coutts International, now owned by Union Bancaire Privee, or UBP, are reportedly also caught up in the scandal – as well as UBS.

More to follow.