February 17, 2011
By Staff Reporter
Allied Irish Banks executive Seamus Sheerin had accused the company of “scapegoating” him in a scandal concerning overcharging. Sheerin took an action in Dublin’s High Court with the aim of preventing the bank from dismissing him.
The two sides came to an agreement late Monday afternoon, after a day of frenzied discussions. Neither would reveal the financial terms of the settlement, under which Sheerin will voluntarily resign from the bank.
However, most observers noted that Sheerin looked pleased with the outcome. AIB had previously vowed to vigorously contest the case.
Sheerin had argued that he had inherited, rather than created, the policies that led to the overcharging scandal.
Customers of AIB’s foreign exchange service were overcharged for the best part of a decade. The bank has so far refunded about $34.1 million to people affected by the affair.
Sheerin claimed that the policy had been effectively in place since 1995 and that he only rose to a position where he was responsible for it in 2002. He also contended that, prior to the scandal becoming public, none of his superiors had suggested that the course that he pursued was inappropriate.
The most dramatic element of the now-aborted case was likely to have been Sheerin’s accusations against the AIB top brass. Michael Buckley, who will soon retire as AIB CEO, was one of three top executives who Sheerin alleged were complicit in the affair. Buckley and the other men denied the allegations.
In the wake of the settlement, AIB released a statement defending its position. The bank said that the allegations made by Sheerin “were rejected by the AIB board following an independent investigation and rebutted in the proceedings.” The bank also said that although Sheerin had been offered a severance deal in return for his resignation, the terms of that deal did “not go beyond those available had he been dismissed.”
Despite that, it seems most unlikely that Sheerin would have agreed to a settlement — or would have looked so exuberant about such a settlement being reached — had he not got some kind of ‘sweetener’ in the deal.
It had already emerged during the case that Sheerin earned more than