The financial sanction will be announced in the House of Commons on Tuesday by Paul Murphy, the Northern Ireland secretary of state, and will have to be approved by a vote. Sinn Fein, which has four MPs, has already been denied expenses from the suspended Stormont assembly and this penalty will be extended.
The move will cost Sinn Fein up to £500,000 (€700,000). One of the party’s MPs, Michelle Gildernew, claimed £140,000 in expenses last year.
The Independent Monitoring Commission (IMC) recommended financial sanctions against Sinn Fein for the role some senior members played in sanctioning the Northern Bank robbery. The IMC pointed out that a fine would seem “paltry” compared with the £26.5m stolen by the IRA gang.
Tests on £60,000 seized by gardai at a house in Douglas last week are expected to confirm that it came from the Northern Bank raid. Forensic tests are continuing at Garda headquarters in Dublin on the £2.3m seized at the home of Ted Cunningham, a businessman, who was released from custody yesterday after two days of questioning.
The former husband of Camilla Parker Bowles has emerged as a business associate of Phil Flynn, the former Sinn Fein vice-president, who has also been questioned by gardai as part of a huge investigation into IRA money laundering. Flynn resigned on Friday as one of six directors of Harcourt Developments, a property company of which Brigadier Andrew Parker Bowles is also a director.
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A senior Garda officer said: “We’re aware of the Parker Bowles company, the nature of its business and its Irish connections. We may shortly ask our colleagues in Britain to assist us with our inquiries. However the scale of our inquiry is unprecedented and this connection is not a priority at the moment. That may change as the investigation widens, in due course.”
A Harcourt spokesman said: “There is no reason for them to do that (investigate Harcourt). Mr Flynn is a non-executive director in Harcourt and does not even have a shareholding in it.”
Government sources in Dublin yesterday revealed that they are aware of intelligence showing Flynn in the company of Thomas “Slab” Murphy, the chief of staff of the IRA and a millionaire smuggler from south Armagh. A senior government source revealed that surveillance on leading IRA figures had shown Flynn socialising with them, even as he was working as a consultant on government projects.
The source said: “You see that’s part of the problem for Phil, he never cut the ties with some of these guys. He would appear openly in the company of Slab Murphy or other senior figures in the movement.”
Flynn resigned on Friday as head of the government’s decentralisation advisory group, as chairman of Bank of Scotland (Ireland), and from the Voluntary Health Insurance body.
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Bertie Ahern, the taoiseach, said yesterday that Flynn had decided it was better to withdraw from his various commercial and state positions while the Garda investigation was going on.
“He has said he believes his name will be cleared, so we note what he said and obviously we thank him for the work that he has done for the various boards in positions that he had held for the state,” said Ahern.
Flynn, along with Cunningham, is a director of Chesterton Finance. “I am absolutely confident and convinced that Chesterton will be cleared,” he said yesterday. "It could take a long time." He also denied doing any recent financial work for Sinn Fein or the republican movement.
Detectives from the Criminal Assets Bureau yesterday searched Tullybeg Retirement Village, a nursing home owned by Cunningham in Tullamore, Co Offaly.
The £50,000 discovered at a police sports club in Belfast was stolen in the raid, detectives confirmed.
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A man arrested on Friday night after reports that he had been burning sterling in his garden in Passage West, Cork, was held in custody overnight.
Dermot Ahern, the minister for foreign affairs, called on republicans to recognise that "Provisional criminality" was the root cause of the current impasse in the peace process.