AIB to enter mediation talks with six former executives, court told

AIB is to enter mediation talks with six former executives accused by the bank of secretly scheming to take over the clients, business and staff of AIB’s international financial services business for their own gain, the High Court heard yesterday.

The state-owned bank has claimed the six were behind a management buyout offer for AIB International Financial Services (IFS).

It alleges they set up a rival business to take over the clients, business and staff of IFS when AIB decided to sell the business to another group, Capita, in June.

AIB claims that after 25 directors and employees left IFS between June and August, Capita had reduced its offer to buy IFS from €55 million to €33m.

AIB claims an internal inquiry revealed that their actions had led to significant loss and damage being caused to the bank.

The six executives are Pat Diamond, from Elton Park, Sandycove, Dublin; Aidan Foley, formerly of Grawn, Kilmacthomas, Co Wexford; Gerry McEvoy, formerly of Shandon Park, Phibsboro, Dublin; Derek O’Reilly, Fernleigh Drive, Castleknock, Dublin; Andrew O’Shea formerly of Ashbrook House, Julianstown, Co Meath, and Joe Walsh, formerly of Grosvenor Terrace, Monkstown, Co Dublin.

The defendants reject the bank’s claims, and deny any wrongdoing.

Earlier this month, AIB secured an injunction requiring the defendants to preserve all documents and computer records. The six also gave undertakings they would not solicit, canvas or try to contact AIB clients or those who were clients as of July 14.

Yesterday, when the matter was mentioned before Mr Justice Peter Kelly, Michael McDowell, counsel for AIB, said the parties will meet later this week in an attempt to the resolve the dispute.

The judge welcomed “anything that could bring an end” to the matter, given the significant time and costs involved should the case be fully contested.

Mr Justice Kelly added if the talks did not produce any results, AIB’s application for the injunctions against the six to remain in place pending the full hearing of the action, will commence before the Commercial Court on Monday.

If that hearing goes ahead, the court will also consider an application brought on behalf of one of the defendants, Mr O’Shea, aimed at dismissing AIB’s action.

It is brought on the grounds that AIB failed to disclose important facts to the court when it sought the interim injunction.

The hearing is expected to last three days.