High Court

Dundalk firm seeking injunction preventing bank from terminating business arrangements

Dundalk-based money transfer/Bureau de Change business

Aodhan O'Faolain


Aodhan O'Faolain

Dundalk firm seeking  injunction preventing bank from terminating business arrangements.

Dundalk firm seeking injunction preventing bank from terminating business arrangements.

A Dundalk-based money transfer/Bureau de Change business is seeking an injunction preventing Bank of Ireland from terminating their business arrangements.  

Blue Diamond Sports Ltd t/a Dundalk Bureau de Change, and a related firm Blue Diamond Sports No 2 Ltd says the bank wants to end their banking arrangements and close their accounts because of alleged links between the plaintiffs and money laundering.

Blue Diamond denies any wrongdoing claims the bank's decision, which means the company won't have access to its payments account systems, is discriminatory, disproportionate, lacks objectivity and is unlawful.

Blue Diamond, which acts as an agent for Moneygram International Ltd and is represented by Patrick Leonard SC, says it has been unable to get an alternative banking service providers.

If the bank is allowed to end their relationship it will go out of business, counsel said. 

In proceedings against the Governor and Company of the Bank of Ireland, It seeks various declarations and orders including preventing BOI from withdrawing its banking services or closing accounts Blue Diamond holds with the bank.

Blue Diamond also seeks declarations the decision to withdraw services are unlawful, discriminatory and disproportionate, and is in breach of the EU Regulations on Payment Services. 

BOI opposes the action and its counsel Bernard Dunleavy SC told the Court that the bank was entitled to terminate the banking relations based on its suspicions that Blue Diamond may be involved in money laundering activities.

Counsel said there were several transactions which made BOI suspicious that Blue Diamond may be involved in money laundering, and said that explanations are given in relation to the transactions, some of which involve large sums of money, were not satisfactory. 

In a preliminary application, Blue Diamond has asked the High Court for an injunction compelling BOI to continue to provide it with banking services pending the final outcome of the case.

The application came before Mr Justice Senan Allen. 

Mr Leonard SC for Blue Diamond said the company operates its businesses from Park Street and Linenhall Street, Dundalk. 

It had banked with BOI for some nine years. 

In April BOI, without warning, informed Blue Diamond that it wants to end their banking relationship.

Counsel said the decision to terminate the relationship came a shortly after Blue Diamond had repaid a loan to BOI. 

Counsel said BOI had failed to steps to investigate nature of Blue Diamond's business and seemed to be using its commercial success as being evidence that it was being used by other persons for money laundering. 

The plaintiff also claims BOI had not closed the accounts of Blue Diamond's customer the bank had identified as potentially been engaged in money laundering.

Instead, it wants to close blue Diamond's account which counsel said is unlawful and in breach of EU regulations. 

In reply, Mr Dunleavy SC said BOI had obligations under anti-money laundering laws and rejects claims that it has acted unlawfully. 

Counsel said it is BOI's suspicion money going through the plaintiff is being laundered. 

If this allegedly laundered money could be described as being "dirty linen" then Blue Diamond is the "laundrette" and "is the party washing the funds clean," counsel said. 

Following the conclusion of submissions from both parties, the Judge reserved his decision. 

He said the case raised issues that he had to think about and he would give judgement "as soon as I can."