The fine is the biggest yet from the FSA related to financial crime
The UK arm of the insurance broking group Aon has been fined £5.25m for making "suspicious payments" worth $7m (£4.6m) to people and firms overseas.
The fine was levied by the Financial Service Authority (FSA) and is its largest fine yet for "financial crime".
It said Aon had failed to put in place proper controls to stop potential bribes and corrupt payments.
The FSA said the company had co-operated "fully" with it since its failings came to light in 2007.
The 66 suspicious payments were made between January 2007 and September 2007 but were not deliberate, the FSA said.
Nor was Aon's behaviour reckless, the FSA said, but its internal controls had failed to stop its staff making payments that might be bribes to win business overseas.
"Aon did not take reasonable care to establish and maintain effective systems and controls for countering the risks of bribery and corruption associated with making payments to non FSA-authorised overseas third parties who assisted Aon in winning business from overseas clients, particularly in high risk jurisdictions," the FSA explained.
The suspicious payments were made by some Aon staff to people in various countries who were involved in helping the group obtain new business.
The countries were Bahrain, Bangladesh, Bulgaria, Burma, Indonesia and Vietnam, and the payments have been referred to the Serious Organised Crime Agency (SOCA).
The company is one of the UK's biggest insurance and reinsurance brokers.
"Aon failed adequately to question the purpose and nature of these suspicious payments in circumstances where it ought to have been reasonably obvious to Aon that there was a significant risk that the overseas third party might bribe the insured, the insurer or a public official and/or that there was no genuine commercial purpose to making the payment to the overseas third party," the FSA added.
The fine would have been £7.5m if Aon had not admitted its failings at an early stage.
However, the FSA pointed out that Aon had been censured and fined £300,000 in 2003 for similar failings by two predecessor firms, Alexander Howden and Nicholson Leslie.