The Department of Education has identified a paper trail showing a €1m fraud at its regional headquarters in Athlone, it was confirmed tonight.
An internal audit lasting five weeks was launched at the branch in May and found a civil servant had made a series of irregular payments out of department funds.
But the employee at the centre of the allegations has since died.
A spokeswoman for the Department of Education confirmed an investigation was ongoing.
“The department did report concerns about a possible fraud to An Garda Siochana. The gardaí are investigating the matter,” she said.
“The department is also conducting its own inquiry and it would be inappropriate to comment any further.”
It is understood gardaí were called in by officials at the department but it is unclear whether fraud squad officers can proceed with an investigation as the man at the centre of the allegations has died.
The Athlone branch of the Department of Education employs several hundred civil servants and looks after state examinations and special education.