The Bank of Ireland has been fined £375,000 by the Financial Services Authority (FSA) in Britain.
Philip Robinson of the FSA said, 'BoI did not establish adequate systems and controls to monitor the issuing of bank drafts and did not check that its staff understood fully their anti-money laundering responsibilities in relation to the recognition and reporting of suspicious transactions.'
The FSA found that between 1998 and 2002, 40 bank drafts were issued for cash for one of the branch's largest customers.
The drafts were made payable to the BoI and, because the identity of the owner of the cash was disguised, were an effective means of money laundering.
BoI failed to detect the misuse of the draft facility until it was identified during a branch audit in March 2003, when drafts issued to the customer worth £1.8m were found to be outstanding.
'These transactions appear to be suspicious and are currently being investigated by law enforcement,' the FSA said in a statement.
