SHANE ROSS EUGENE Sheehy, the newly appointed boss at AIB, faces a titanic task to convince small customers of the bank's honesty, according to new information seen yesterday by the Sunday Independent.
Figures supplied by Bankcheck, the Belfast-based company which examines bank accounts for evidence of overcharging and other errors, have confirmed that AIB is the worst offender of all Irish banks.
A sample of nearly 100 cases handled by Bankcheck shows that it has recovered nearly ?3m from banks on behalf of clients over recent years. AIB has been forced to refund the lion's share (?1.2m), more than 41 per cent of the total figure - to clients over the same timespan.
In second place comes Ulster Bank with refunds to clients of ?886,000 (30 per cent). Nearly all the requests to Bankcheck for investigations of their accounts came from small-to medium-size businesses.
The number of complaints successfully completed by Bankcheck against AIB stands at 42 while Ulster Bank was the subject of 36 cases successfully concluded by the Belfast auditing firm.
The news will come as a further body blow to AIB, still struggling to repair the damage to its reputation after a series of overcharging scandals revealed against Ireland's biggest publicly quoted company. These included the systematic overcharging exposed in last year's foreign exchange scandal where AIB paid out ?50m. Mr Sheehy was untouched by AIB's latest foreign exchange overcharging scandal as he was running the US division at the time.
Among the highest payouts by AIB was a refund of ?210,000 plus costs made to the Kerry children's charity, the Kerry Parents and Friends of the Mentally Handicapped, following an investigation by Bankcheck.
Bottom of the table among the clearing banks come National Irish/Northern Bank - with just ?202,000 paid out in cases brought against them, while surprisingly good results come from Bank of Ireland. They have only paid out ?215,000 in settlements, about a sixth of the amount handed back to clients by AIB.
The audit firm only pursued six cases of overcharging against the BoI, although the average payout in BoI's case was ?36,000, far higher than any of the other big banks.
A spokesman at Bankcheck wanted to stress that AIB and Ulster more often acknowledge their mistakes when challenged and pay out refunds to wronged clients far more readily than BoI.
Bankcheck is currently taking a number of cases against the BoI, which tends to prefer to go the confrontational legal route, rather than to settle.
One of the principal differences between AIB and BoI is the system of charging on annual renewal of overdrafts. A systems method at AIB is believed to account for a vast number of claims on which it is willing to pay refunds, while BoI has a different procedure.
The AIB system defaults in favour of the bank when the overdraft facility is not immediately renewed. The client is charged penalty interest.
Bankcheck currently has several high-profile cases on its books where it is seeking at least ?1.6m from Ireland's financial institutions. Apart from large loans and mortgages for private individuals it mostly deals for businesses but reports that 80 per cent of bank accounts brought to them for investigation are flawed in one way or another.
According to a spokesman, "mistakes in favour of the customer are extremely rare - if not unique".