Gardai are expected to question a Department of Agriculture official in Sligo after it was discovered that nine cheques worth £250,000 had been issued to non-existent farmers under an EU grant scheme.
It is understood nine cheques were issued by the Department's finance section on the basis of forged documents emanating from the Sligo office.
Four of the cheques, worth £100,000 were cashed, it is understood but a further five worth £150,000 have been stopped.
The affair came to light by accident when the owners of two bedand-breakfast establishments in the Sligo area received mail for a man, using the same name, who had told both women he intended staying with them for some months. The women alerted the authorities.
A spokesman for the Department said yesterday that the Garda Bureau of Fraud Investigation had been asked to help with the inquiries.