Business Irish

Sunday 22 September 2019

Central Bank of Ireland hits life assurance arm of Italy’s largest bank with €1m fine

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The Central Bank of Ireland has hit the life assurance arm of Italy’s largest bank, Intesa Sanpaolo, with a €1m fine after discovering "significant failures" in its anti-money laundering and counter-terrorist financing controls.

Intesa Sanpaolo Life, which does not sell life assurance products in Ireland, has admitted the breaches.

This latest fine follows a string of similar cases this year as the regulator continues to crack down on institutions with weak anti-money laundering regimes, amid a global push to strengthen compliance in this area.

In April AIB was slapped with a €2.3m penalty for six breaches of anti-money laundering and counter terrorist financing controls. A month later it was Bank of Ireland’s turn, with the lender wearing a €3.15m fine for compliance failures in its anti money laundering controls.

In March Drimnagh Credit Union was penalised to the tune of €125,000 for widespread shortcomings in its anti-money laundering procedures.

In a statement the Central Bank said it identified four breaches of Criminal Justice (Money Laundering & Terrorist Financing) Act, 2010 at Intesa Sanpaolo Life, which at the time of the failings sold life assurance products into Italian and Slovakian markets.

The breaches occurred in July 2010 and continued on for a further three years and eleven months, the regulator said.

Brenda O’Neill, head of enforcement investigations, said "the Central Bank has responsibility for monitoring and enforcing the compliance of life insurers based in Ireland with the CJA 2010. This includes insurers such as Intesa that 'passport' in order to operate in other EU member states on a freedom of services basis without establishing branches in those other member states."

She stressed "this case, and the level of fine imposed, reinforces the requirement that firms in all sectors must adopt robust and effective policies and procedures to prevent and detect money laundering and terrorist financing.  Furthermore, firms must ensure such policies and procedures are updated in a timely manner in response to changing legal and regulatory requirements, emerging risks and evolving business models."

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