AIB chairman says his remarks will be constrained

The AIB chairman, Mr Dermot Gleeson SC, has indicated that he will be "constrained" in his remarks about the overcharging scandal at the bank when he meets today with an Oireachtas committee.

The chairman of the Joint Committee on Finance and the Public Service, Mr Sean Fleming TD, said in advance of the meeting that the affair had "implications for the general confidence in the Irish economy" given AIB's prominent position.

"There's been so many different issues that no reasonable person can believe that they weren't known at a very high level in the bank," he said.

With IFSRA's inquiry into whether there was a cover-up within the bank still ongoing, Mr Gleeson said in a letter to Mr Fleming last week that he would not discuss disciplinary matters arising from the scandal.

Mr Gleeson and the AIB chief executive, Mr Michael Buckley, will be questioned today about the culture in the bank.

AIB has already promised to repay some €34.2 million to customers who were charged more than the advertised rate for foreign exchange and other services.

"Tax issues" in relation to a scheme for senior executives, which was managed by AIB Investment Managers, are the subject of separate inquiries by AIB, IFSRA and the Revenue.

IFSRA published an interim report into the overcharging affair last July, based on the work of a team of investigators from Deloitte.

While the team has finished its examination of whether there was a cover-up, IFSRA's final report is not now expected until the end of the year.

The bank refused to meet the committee last May because the initial investigation into the overcharging was still underway.

Mr Gleeson pointed out in his letter to Mr Fleming, which was circulated yesterday to committee members, that the investigation was incomplete and the "final conclusions" were not yet drawn.

He said: "Because of roles that the chief executive and I, as chairman, have in appeal phases of certain internal disciplinary processes in AIB, we have not had access to the second Deloitte report insofar as it refers to the roles that individuals may have had in the notification failures in relation to foreign exchange charges.

"The board of AIB set up a special committee to determine our response to the inquiry and the committee's remit includes the consideration of any appropriate disciplinary proceedings.

"The [ Oireachtas] committee will appreciate that legal constraints arising from obligations of fairness will oblige us to refrain from discussing these disciplinary matters."

Mr Fleming said he had "no problem" with Mr Gleeson's letter but was interested in the general area of discipline within the bank. "In terms of the general culture in the Irish operation, it appears that no heads have ever rolled," he said.

Mr Fleming wished to concentrate on the bank's culture at the hearing and believed it was very significant that Mr Gleeson would attend.

Fine Gael deputy leader and finance spokesman Richard Bruton said he would be raising several issues at today's meeting. These include accusations that AIB and other banks are making "super-profits" from customers through investment deal allocation and the creation of offshore companies.