The HSE is investigating allegations that hospital staff accepted holidays and gifts from a medical supplier.
Concerns that some staff at St Vincent's University Hospital and the Beacon Hospital in Dublin received expensive gifts and passed on sensitive information to the supplier, were highlighted on RTÉ's Primetime last night.
3pm update: Health Minister Leo Varadkar has confirmed that a Garda Fraud Squad investigation is being carried out.
"We're in a a situation we're going to continue to monitor closely," he said.
"The allegations are of a criminal nature, so criminal allegations can only be investigated by the Garda Fraud Squad and they have the information and obviously the HSE can audit hospitals and when it comes to private hospitals or voluntary hospitals, the responsibility lies with the Boards of those hospitals to take the necessary action."
A statement from the HSE this morning confirmed an investigation has been launched and no payments will be made to Eurosurgical "until further notice" by any HSE bodies.
The Beacon Hospital says it takes the allegations extremely seriously and has placed one employee on leave until further notice, while it carries out an internal investigation.
In a statement, St. Vincent's hospital says it is also carrying out an internal investigation.
It says it has put two staff off duty with immediate effect and that it is investigating all aspects of the hospital's relationship with the supplier company involved.
Chief Executive of the Irish Medical and Surgical Trade Association, Justin Carty, says the activities alleged in the programme are strictly prohibited.
"Unlawful payments and practices are strictly prohibited by our code of practice," he said.
"Members should not directly or indirectly offer, make or authorise payment of money or anything of material value to unlawfully induce or influence judgement or the conduct of individual customer or company to win or attain business, to influence any act or decision of any government official or to gain an advantage."
The Dáil's Health Committee later confirmed that it will hold a meeting next week to discuss the allegations.