The amount of money lost by a stockbroker at the collapsed Cork firm, W&R Morrogh, may have been as high as £7 million, informed sources have told The Irish Times.
The latest estimate to emerge is far higher than previously thought and means that some of the firm's more than 9,000 clients could be left seriously out of pocket.
Even after the injection of more than £2 million by the firm's partners from their own resources, the shortfall at the firm is currently believed to be around £5 million.
Clients of the company who had large amounts of money sitting in accounts following the sale of shares are the ones most likely to lose.
The Investor Compensation Scheme has a ceiling of #20,000 (£15,700) for investors who lose money in circumstances such as those at W&R Morrogh. It is understood some clients have amounts on deposit significantly in excess of this ceiling.
The firm's receiver, Mr Tom Grace of Pricewaterhouse Coopers, and representatives of the Central Bank were seeking to interview Mr Stephen Pearson, the Morrogh partner alleged to be responsible for the collapse of the company. Last week Mr Grace was given permission to raise the matter in the courts if he did not receive co-operation and it is thought the fact that he has not done so indicates Mr Pearson is co-operating with inquiries.
In the High Court last week, Mr Pearson's solicitor, Mr Michael Hanahoe, said that Mr Pearson was hospitalised but his client would give full co-operation.
The court was told Mr Pearson had lost £3.2 million in trading financial futures and that there was a shortfall of almost £1 million at W&R Morrogh even after the firm sold more than £2 million worth of London Stock Exchange shares, which the partners owned, to help offset the losses.
But sources have said further investigations indicate the losses incurred are substantially more than first thought. The sources said Mr Pearson's losses on his futures trading may be "up to £7 million".
The firm's senior partner, Mr Alec Morrogh, and Mr Pearson are personally liable for any shortfall which arises, after which the Investor Compensation Scheme comes into play.
Last week the High Court hearing gave Mr Morrogh until next Monday to pursue negotiations with potential investors.