A total of 926 billion Iraqi dinars ($697 million) went missing due to "forgery, embezzlement, manipulation, money laundering (and) abuse of position", the Commission for Integrity said in a statement.
The alleged fraud took place at a branch of Maysan province's agricultural bank, as well as four branches of Rasheed Bank in Maysan and the capital Baghdad, the commission said.
The commission did not specify the timeframe of the offences, but a commission official, who did not want to be named, said investigations into suspected illegal activity began in 2019.
"Arrest warrants will be issued against 41 people suspected" of wrongdoing over the affair, the official added.
The commission said bank employees and even customers were among those implicated in a scandal that amounts to a "process of organised sabotage against the national economy".
Corruption plagues all levels of the Iraqi state, but middle managers, rather than top officials, tend to bear the brunt of anti-graft campaigns.
Official figures published last year estimated that well over 400 billion dollars has gone missing from state coffers in the near two decades since dictator Saddam Hussein was toppled in 2003.
The country ranks 157 out of 180 countries in Transparency International's corruption perceptions index.
Major anti-regime protests in late 2019 were spurred in large part by anger over corruption and the related dilapidation of public services.
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