DUBLIN, (Reuters) – The Bank of New York Mellon (NYSE) has fined the Bank of Ireland (Reuters) Corp’s Irish fund administrator arm 10.8 millions euros ($11.9million) for 16 regulatory violations. This was compounded when the company provided misleading information during an investigation.

This was the biggest fine Ireland ever imposed on a fund provider. BNY Mellon Ireland has just under 1.13 trillion euros of assets under administration. This makes it the second largest administrator for funds in Ireland and a key player in the international fund industry.

BNY Mellon Fund Services, Ireland (as other operators) offers fund administration and “back office” services for fund managers in Ireland and all over the globe.

BNY Mellon Ireland had failed to adhere to regulatory requirements and set up a governance system for outsourcing activities. The regulator stated that the breach occurred because of BNY Mellon Ireland’s operating model.

According to the central bank, this made it difficult for the bank to accurately identify and manage potential risks associated with outsourcing agreements and made the banking system more vulnerable to the possible risks that could be posed to clients, investors, or the financial market.

“The entire outsourcing framework was found to be insecure, and the investigation showed that there were systemic flaws. “Despite the intervention of the Central Bank over a few years, BNY DAC [BNY Mellon Ireland] repeatedly failed to address those deficiencies,” Central Bank Director for Enforcement Seana Cunningham stated in a statement

BNY Mellon Ireland is part of the parent group that controls the world’s biggest custodian bank. They admitted to 16 breaches.

The fine was reduced to 15.4 millions euros due to a discount.

($1 = 0.9101 euros)