A FORMER executive in AIB corporate banking in London told a London court yesterday that he had no reason to suspect that there were problems with loans of £740 million to an alleged fraudster.

Michael Cooke said he thought everything was going well with loans to Achilleas Kallakis, whom he believed was a shipping tycoon.

However, it later emerged Mr Kallakis and his associate Alexander Williams, both 44, had allegedly tricked Allied Irish Bank into handing over up to £740 million with a series of fake guarantees to fund his property empire.

The duo bought 16 properties, including an office in London’s Mayfair and a £102 million property in Croydon, south London.

The fraud came to light when their business went bust – causing AIB to lose millions as it was forced to sell off the portfolio, the court heard.

At their trial at Southwark Crown Court yesterday, Victor Temple QC, prosecuting, asked Mr Cooke: “Was there ever anything in your mind to put you on notice that things may not be as they should?”

“Nothing whatsoever, everything was very good,” replied Mr Cooke. “Rent was being paid, interest was being paid . . . We took additional comfort from the strength of the property market at the time. Things were going up in value, therefore the risk to the bank was diminishing.”

In five years, Mr Kallakis became one of the bank’s biggest customers, the court heard.

Asked how important the bank’s relationship with him was, Mr Cooke responded: “It was getting increasingly important, the loans we were making were increasing in size. Mr Kallakis would have been considered important as a growing client of the bank. It wasn’t a relationship that we would want to lose.”

The court has already heard that Mr Kallakis used the cash to fund his extravagant lifestyle of yachts and private jets and schmoozed bank staff with overseas trips in Monaco, Mauritius and St Petersburg.

The trial continues.