MILAN (Reuters) - Bank of China has paid Italy's tax authorities 20 million euros ($22.3 million) to settle a tax dispute connected to a money laundering case involving its Milan branch, a source familiar with the matter said on Friday.
The payment by Bank of China was made on January 31, before the lender made a separate deal to settle a criminal case involving the same money laundering allegations, the source said.
Prosecutors in the so-called "River of Money" investigation in Florence alleged more than 4.5 billion euros had been smuggled to China from Italy between 2006 and 2010 by Chinese people living mainly in Florence and the nearby city of Prato.
The prosecutors alleged half of the money had been sent via Bank of China's Milan branch.
In February, Bank of China agreed to pay a 600,000-euro fine to settle the criminal case. It was also ordered by the court to pay back 980,000 euros allegedly earned illegally.
The Bank of China, which was not immediately available for a comment, has previously denied any wrongdoing in the case, noting it was not admitting guilt by agreeing to pay the fine.
The Italian tax office declined to comment.
($1 = 0.8950 euros)
Reporting by Emilio Parodi, additional reporting by Antonella Cinelli in Rome and Shu Zhang in Beijing, writing by Stephen Jewkes, editing by Steve Scherer