Woman settles action against AIB

A WOMAN who claimed a bank told her a €100,000 investment would be risk free although it dropped in value to just €40,000 has settled her legal proceedings against the bank.

Doreen Rock, 63, of Woodside, Ballinora, Waterfall, Cork, claimed Allied Irish Bank plc (AIB) told her the investment was guaranteed when she agreed to put the money into a five-year Hibernian Aviva “spectrum bond”, a property investment scheme backed by a number of “blue chip” businesses. It made €9,000 in its first year but is now only worth €40,000, the High Court heard.

Ms Rock claimed that when she agreed to the investment in September, 2006, she made it clear to an AIB financial advisor that the capital sum should be protected.

She said the bank, among a number of alleged failures, did not carry out dealings with her in accordance with normal practice and banking standards and failed to adhere to her instructions.

The bank denied the claims.

Yesterday, Mr Justice John McMenamin was told by counsel for Ms Rock the matter had been resolved and the case could be dismissed without any order as to costs.

Ms Rock claimed the bank misrepresented to her that the return on her investment would be greater than if she left the money in a low-yield deposit account. She also said she was subject to undue influence by being induced to invest in the bond even though the bank knew she had no prior investment experience.

She had claimed damages for breach of fiduciary duty or alternatively, a declaration that the investment agreement was invalid.

The court heard she and her husband Liam sold a house they owned in 2005, and were left with €200,000, which was on deposit with AIB.

While Ms Rock said her money was “safe where it is” and did not want to do anything with it, she agreed to meet one of the bank’s financial advisors and signed up for the investment.