[Attending the Condolences of an Open Sinner]

Answer—and Allah is the One who grants success and aid: It befits the preacher-guide to attend gatherings of condolence, for there is in that the benefit of guiding people and calling them to good, as well as closing the door to opponents and mischief-makers.
Moreover, even if the deceased was sinful, offering condolences is legislated—even to dhimmīs. He should employ interpretation in what customarily occurs of reciting al-Fātiḥah if the deceased was sinful; for example, he may say: “al-Fātiḥah for the soul of the deceased”—with a kasrah on the fāʾ in “al-mutawaffī,” meaning the One who takes souls, i.e., the Angel of Death—“Say, ‘The Angel of Death will take you who has been entrusted with you.’” [al-Sajdah:11]—or: “for the soul of the one transferred to the mercy of Allah.” In such a situation the preacher should indicate, after urging the establishment of prayer and repentance, that whoever dies as a sinner without repenting—neither supplication nor Qur’an recitation benefits him; that it is not permissible to supplicate for him nor to recite Qur’an for him—so as to remove any confusion that may arise.
Source : Min Thimār al-ʿIlm wa al-Ḥikmah vol.1