A Northern Ireland insurance firm has been shut down by regulators because the police are investigating it for alleged money laundering.

The Financial Services Authority, the UK's top financial watchdog, said on Thursday it had banned Northern Ireland Insurance Brokers Ltd from offering advice about or selling financial products.

The FSA is working with the Police Service of Northern Ireland on the case, which has already uncovered £8m in money alleged to be laundered through the firm.

Understandably, NIIBL denies the allegations, saying it will robustly be challenging them.

The two people who run the firm - Michael Aiken and his son, Michael junior - were arrested and questioned earlier this year, but were freed without any charges being brought at the time.

Evidence

Regardless of NIIBL's protestations, the FSA said it found evidence that the firm has actively helped clients use false addresses in investment dealings.

Not only that, the watchdog said, but the addresses used - addresses it had guaranteed as genuine to the companies whose products it brokered - were either controlled or owned by NIIBL itself.

The investigation had already found £1.2m which had been handled without the proper authorisation.

Police sources have told the Reuters news agency that the investigation was focusing on tax evasion - in both Northern Ireland and the Republic of Ireland to the south - money laundering for criminal enterprises, and acting as an agent for another money launderer.