AIB appoints risk officer in wake of Rusnak fraud

AIB Bank, rocked by a major fraud case this year, said yesterday it had appointed Shom Bhattacharya as chief risk officer in a move designed to prevent a repeat of the scandal.

The position has been created after the scandal of rogue trader John Rusnak, who lost $692 million at the bank's US subsidiary Allfirst through fraudulent foreign currency dealing.

Ironically, Rusnak and Mr Bhattacharya share a former employer. They both worked for Chemical Bank, a predecessor of JP Morgan Chase.

Mr Bhattacharya was a senior corporate financier, while Rusnak was a currency options trader. Mr Bhattacharya, 51, will report to chief executive Michael Buckley and be on the bank's group executive committee. This is meant to signal the increased importance AIB now attaches to its risk management strategy.

Rusnak has pleaded guilty to bank fraud and agreed to help US investigators in the ongoing investigation.