Drimnagh Credit union fined €125,000 for ‘widespread’ policy failings

CU failed to adopt anti-money laundering and terrorist financing policies

The Drimnagh Credit Union fine is the third enforcement case which the Central Bank has taken against a credit union since the administrative sanctions procedure became fully applicable  in August 2013.

The Drimnagh Credit Union fine is the third enforcement case which the Central Bank has taken against a credit union since the administrative sanctions procedure became fully applicable in August 2013.

 

Drimnagh Credit Union in Dublin has been fined €125,000 by the Central Bank for a number of breaches of regulations, including failing to adopt policies to prevent and detect money laundering and terrorist financing.

The credit union, which has more than 7,000 members, admitted two breaches of the Credit Union Act 1997 and five breaches of the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010.

The Central Bank said it had identified “significant and widespread failings” in Drimnagh Credit Union’s anti-money laundering/countering of the financing of terrorism policies.

Overall, the Central Bank identified two breaches of the CUA 1997, which occurred between August 2013 and November 2014, and five breaches of the CJA 2010, which occurred between July 2010 and September 2015.

The breaches also include failings in the credit union’s systems in relation to the claiming, recording and approving of officers’ expenses, prohibited payments to directors.

Settlement reached

In a statement, Drimnage Credit Union sadi: “Drimnagh Credit Union Ltd confirms that it was subject to an investigation by the Central Bank of Ireland which has resulted in a fine of €125,000 being imposed. The credit union co-operated fully with the Central Bank of Ireland in this process and a settlement was reached.

“The investigation is now closed,” the statement continued. “Drimnagh Credit Union Ltd can assure members that their savings and deposits are not affected in any way by this, and that they can continue to do business with the credit union in the usual way.”

This is the third enforcement case which the Central Bank has taken against a credit union since the administrative sanctions procedure became fully applicable in August 2013.

In December, Bray Credit Union, one of the State’s largest credit unions, was fined €98,000 for similar regulatory breaches. The first enforcement case to be taken was against the Irish Taxi Owners Co-operative Credit Union, which received a €5,000 fine in October 2015 for breaches of its obligations under the 1997 Act.

“It is incumbent upon all credit unions, irrespective of their size or scale, to be aware of and to comply with all applicable regulatory requirements, and to have robust systems and controls in place to ensure full compliance,” said the Central Bank’s director of enforcement, Derville Rowland.

“Failure to do so can undermine the credibility and financial stability of the sector, and the Central Bank will take action as appropriate where non-compliance is identified,” she added.