AIB official in €2m fraud probe

AN ex-bank official has been arrested by garda fraud squad officers investigating claims that customers of Allied Irish Bank were cheated out of almost €2 million.

AIB confirmed the man at the centre of the garda inquiry was formerly employed at an AIB branch in Cork county.

The man, arrested under section four of the Criminal Justice Act by fraud officers from Cork, was released without charge after being held for 12 hours.

Gardaí said a file was being prepared for the Director of Public Prosecutions.

The suspected fraud came to light after an elderly woman living in north Cork complained of irregularities involving an investment of €63,000.

The arrest is the culmination of an investigation which has been ongoing for upwards of 18 months. The man, who cannot be identified for legal reasons, no longer works for the bank. He was not the manager of the AIB bank he worked at.

"He advised customers, ordinary Joe Soaps, to invest their money in x or y, and then he defrauded them of the cash. It's been a lengthy investigation because there are a lot of documents to go over and these things take time,'' a garda source said.

An AIB spokesperson said: "It is not our policy to comment on any garda investigation. The matter, at this stage, is sub judice."

However, the bank confirmed details of the man's employment record with AIB.

The investigation is being conducted by fraud squad officers in Cork, under Detective Superintendent Tony Quilter.

The embarrassing suspected fraud occurred around the time that rogue trader John Rusnak almost bankrupted an AIB-owned subsidiary, Allfirst Financial, in the United States after hiding trading losses of over €500m over a five-year period.

The suspected fraud in Cork county is also believed to have occurred intermittently over a period of time. It was only when one woman claimed she had lost €63,000 because of this man, that his actions came to light.

The former employee was arrested and a number of documents seized from his home. Gardaí have also inspected AIB documents from the Cork bank.