‘Others considering similar actions will draw strength from settlement’

ACC Bank has settled 500 cases of mis-selling after a test case taken by four investors who lost money on so-called ‘low-risk bonds,’ in what is seen as a watershed case for large actions in Ireland.

A spokesperson said: “ACC Bank welcomes the fact that the Commercial Court has unconditionally dismissed the claims of fraud which were made in the four cases being tried by the Commercial Court.”

At least one plaintiff suffered severe losses on an €11m investment on the Solid World Bonds sold by ACC Bank.

Legal sources have said groups considering similar actions will draw strength from yesterday’s ruling.

Financial advisor Eddie Hobbs, who helped to put the group together before bringing in Lavelle Coleman as legal advisor said: “The court case opened and Rabobank had the best legal brains in the country lined up to fight the case but in little under two hours after opening they were looking to settle.”

He said although the case did not set a legal precedent, the fact it had been opened and settled in court was encouraging.

It is understood the plaintiffs had turned down a settlement offer of €10m in early negotiations.

The court admonished the Office of the Financial Ombudsman for not holding an oral hearing into the case.

A previous case taken on similar grounds by O’Hara and Another against ACC Bank had been dismissed by Judge Charleton as Mr O’Hara had tried to take the case through the office. The case involved significant six figure investments by individuals in ACC Bank’s Solid World Bond — the same bonds ACC Bank has since settled.

In the 2011 case, Judge Charleton concluded Mr O’Hara, having made his complaint to the Ombudsman, could not take a second bite of the cherry by trying to re-litigate the same issues in the courts, according to Matthew Austin of Hayes Solicitors.

The legal advisor to the Office of the Financial Ombudsman, Tom Finn, said going to court and going to the Ombudsman could result in a different outcome.

“People may often have to make that decision, do they go to court or do they go to the Ombudsman, and it may result in very different outcomes.”