The former Barings Bank trader, Mr Nick Leeson, believes the necessary checks to ensure currency traders could not lose huge amounts of the bank's money "should have been in place after Barings", he said.
Barings Bank collapsed in 1995 after Mr Leeson ran up a $1.4 billion (€1.6 billion) loss in unauthorised transactions. Mr Leeson was subsequently jailed for four years.
Speaking to RTÉ yesterday, Mr Leeson said he had "massive feelings of shock" when he heard about the losses at AIB's US subsidiary. "I never expected that this could happen again."
He said such a large sum was involved in what had happened that it had obviously taken some time. He surmised that the tradings which led to the losses had occurred in the time between the last audit of the bank and its discovery.
He said the indications were that the Allfirst trader Mr John Rusnak had started small and seen the problem develop, just as has had been the case with him, Mr Leeson.
The similarities between his case and the AIB one were "quite great". AIB was saying otherwise but he did not agree, he said. It was true that AIB was not going to collapse but that was as far as the difference between the two cases went.
He said the products traders dealt in were complex but that the fraud was simple. The losses had gone on for some time and there should have been various levels in the bank doing checks.
Mr Leeson said the question arose as to why the bank was sending such large sums of money to someone who represented such a small amount of the bank's turnover.
