Intesa is the largest cross-border life insurer authorised to operate in Ireland by the Central Bank of Ireland.
Multiple failings
In June 2014 Intesa commissioned an independent review into its anti-money laundering controls which identified suspected non-compliance with Ireland’s Criminal Justice (Money Laundering and Terrorist Financing) Act.
Following the review, Intesa informed the Central Bank of Ireland who began their own review.
The regulator identified four breaches, which Intesa has now admitted to, being inadequate risk management, inadequate due diligence on certain “politically exposed person” and inadequate reporting lines for reporting suspicious transactions.
Additionally, it was found the firm had failed to incorporate a review mechanism into its anti-money laundering procedures.
The breaches relate to life insurance products sold by Intesa in Italy and Slovakia between 2010 and 2014.
Passport system
Intesa operates under a “passport” system which means they can operate in other EU member states without establishing branches in those nations.
Financial enforcement expert Michael Ruck of Pinsent Masons says the case highlights that anti-money laundering is a high priority for regulators worldwide.
“Despite Intesa not selling its life assurance products in Ireland, this case highlights that firms authorised in Ireland and ‘passporting’ into other European Union financial markets will remain subject to Irish AML/CFT legislation,” Ruck said.
“This approach will likely be mirrored elsewhere and lead to significant financial penalties even when the firms in question bring the matters to light,” he said.
The Central Bank based the size of the penalty on the seriousness of the conduct, time over which the breaches occurred and Intesa’s cooperation with the investigation.
