Friday 21 July 2017

AIB suing six former senior staff over 'poaching' clients

Bank alleges that move by the group to set up a rival operation, taking another 20 colleagues, cost it €22m

AIB claims the actions of the former staff cost the bank €22m. Photo: Steve Humphreys
AIB claims the actions of the former staff cost the bank €22m. Photo: Steve Humphreys

Siobhan Creaton and Ray Managh

AIB has launched a High Court action against six of its former senior staff who poached 20 colleagues and some of its clients for a rival business.

The bank claims their actions cost the bank €22m as it was forced to accept €33m for its International Financial Services business in a deal that is still to be finalised with the Capita Group, having initially been offered €55m for it.

AIB is now suing the former head of AIB International Financial Services (IFS), Pat Diamond, along with Gerry McEvoy, Derek O'Reilly, Andrew O'Shea, Joe Walsh and Aidan Foley, who were all senior executives at the company and who now work for Centralis, a company they are setting up with operations in Luxembourg, Hungary and Switzerland.

Conspiracy

In an ex parte application, Michael McDowell, representing AIB, said it was claiming that there had been a clear conspiracy and covert plan by the former executives to set up a competing business and to poach its staff and clients.

They had called the project "Plan B", he told Judge Barry White yesterday.

Mr Diamond, Mr Walsh and Mr Foley had been amongst a group of AIB management that made a bid for this business which was to be sold as part of AIB's efforts to raise cash as part of the Government's rescue plan for the bust bank.

The company, known as AIB-IFS, provided outsourced services such as administration, treasury management and back office duties to big international financial institutions and companies that employed around 100 people at Dublin's International Financial Services Centre and another 60 in Switzerland, Luxembourg and Hungary.

In an affidavit, Ronan O'Neill, the head of the bank's Corporate Banking Division, claimed his former colleagues have been party to "an unlawful conspiracy" to take the company's business by the "unlawful and deliberate downloading" of information he described as "trade secrets and confidential" to be used to set up a business that would compete with their former employer for their own benefit.

He said they used secret and confidential information to try to persuade the company's customers to bring their business to their new venture.

Mr O'Neill said that, given their conduct so far, the bank was very concerned they would erase or destroy the documents and electronic records rather than making them available to the court.

Orders

Yesterday Judge White granted the bank temporary orders to preserve all of the documents regarding the head hunting of staff and loss of clients that will also apply to internet service providers.

The case, which has been put on the Commercial Court list, will come back before the court on September 20.

The bank hopes to finalise the deal with Capita in the coming months and warned that it could potentially suffer further losses if the actions taken by the six men were not restrained.

AIB still has other businesses that will be sold and if employees there began to poach staff and clients in a similar way it could reduce the potential sale price.

"This is a matter of concern not just to the bank but more generally to the taxpayers where the bank is now over 90pc owned by the State," Mr O'Neill said.

Irish Independent

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