The IRA is using untraceable money stolen from the Northern Bank robbery last December to buy properties for cash in the United Kingdom, the Government believes. Mark Hennessy and Conor Lally report.
The £26.5 million was quickly broken up into "five or six parcels" in the days after the December 20th raid to help the IRA in its effort to "launder" the banknotes.
They believe each parcel was to be laundered separately. The property-buying operation went into action shortly after the bank raid, a senior Irish political source told The Irish Times.
"They are finding properties and then using frontmen to buy them and sign for the deeds," the source said.
In a bid to evade the UK's anti-money laundering legislation, the IRA has concentrated its efforts on cash-strapped property owners who need to sell quickly.
The laundering legislation requires estate agents and others to declare all transactions over £10,000 to the Financial Intelligence Division of the National Criminal Intelligence Service.
The NCIS in 2003 was told of 100,000 such transactions and this number is understood to have increased rapidly since, particularly after the laundering legislation was further tightened in March 2004.
Meanwhile, the IRA also managed to launder a significant element of the bank haul at the four-day Cheltenham races, where up to £1.5 million was bet on each of the races.
The focus of the investigation - which involves the Criminal Assets Bureau and the Garda Bureau of Fraud Investigation - has now broadened considerably as gardaí try to identify businesses around the country which may have been used to launder the money.
Convinced that a number of these companies have been used to launder IRA money, one senior Garda source said existing legislation was "all over the place" with some financial sector companies, including many which offer loans to borrowers unable to obtain them from banks and building societies, facing little or no regulation.
Investigators have identified a substantial number of these companies and each one will be examined closely by gardaí in coming months.
In February gardaí found £2.3 million at a house in Farran, Co Cork, owned by Ted Cunningham, who runs a money lending company, Chesterton Finance.
He was arrested, but later released without charge.
They also discovered a man burning a large amount of sterling banknotes in a back garden in Passage West, Co Cork.
Investigating detectives believe the money was linked to the Northern Bank raid in Belfast.
The Cork properties were searched as part of a Garda follow-up operation into suspected IRA money laundering after three men were arrested at Heuston Station, Dublin, on February 16th.
One of the men had travelled from Cork and was handing over a box containing £54,000 to the two other men, who are from the North, when gardaí moved in and arrested them.
Detectives believe that the IRA had intended to launder some €10 million through a company in Munster, but that the Garda raids in Cork in February derailed the plan.