The Central Bank of Ireland has fined Allied Irish Banks,(‘AIB’) €2,275,000 and reprimanded it for six breaches of the Criminal Justice (Money Laundering & Terrorist Financing) Act, 2010. All six breaches have been admitted by AIB.
The Central Bank identified six breaches of the CJA 2010 as a result of significant failures in AIB’s anti‐money laundering and counter terrorist financing controls, policies and procedures. The breaches occurred after the enactment of the CJA 2010 in July 2010 and persisted on average for over three years.
They included AIB’s failure to:
- Report suspicious transactions without delay to An Garda Síochána and the Revenue Commissioners.
- Conduct customer due diligence (‘CDD’) on existing customers who had accounts prior to May 1995 (‘Pre‐95 customers’) when the first Irish laws on anti‐money laundering and countering the financing of terrorism (‘AML/CFT’) became effective.
The Central Bank also identified breaches in respect of AIB’s AML/CFT policies and procedures in a number of areas, including the above, and its trade finance business.
Director of Enforcement, Derville Rowland, said: Anti‐money laundering compliance is a continuing and increasing priority for the Central Bank across all financial services sectors. Firms must have rigorous and robust processes for identification, assessment and reporting of suspicious customer activity. Crucially, those processes must ensure that information on suspicious activity is provided to An Garda Síochána and the Revenue Commissioners without delay to assist with the investigation of money laundering and terrorist financing. This case emphasises the fundamental information sharing role of the financial services industry in the fight against money laundering.”
“Reporting suspicious customer activity to An Garda Síochána and the Revenue Commissioners underpins that role. Reporting suspicious activity is time‐critical and firms across all financial services sectors must, as a priority, monitor and ensure the adequacy of resources for that task. In this case, it was particularly concerning that sufficient resources were not applied promptly to investigate a substantial backlog of alerts of potentially suspicious activity.
“This is the second enforcement action taken, in the last six months, by the Central Bank against a bank for unacceptable weaknesses in its anti‐money laundering framework. The Central Bank expects that anti‐money laundering frameworks are ‘fit for purpose’, in that, they are appropriate to the nature, scale and complexity of a firm’s business activities. In particular, we expect that our retail banks, as gateways to the financial system, have in place exemplary anti‐money laundering systems and controls.”
“This case emphasises that enforcement of anti‐money laundering requirements is, and will remain, a key Central Bank priority and we are prepared to take action where firms fail to comply.”