Britain's Serious Fraud Office has started an investigation into an alleged property scam which cost AIB £56m (€60m).
The SFO and City of London Police raided three business and residential addresses in central London yesterday, although no arrests have been made.
The allegations centre on loans made by the bank to the main suspect to buy UK investment properties, based on fraudulently high levels of rents and lease lengths.
Other financial institutions may also have fallen prey to the alleged fraudsters, the SFO added.
The loans were made between 2003 and 2007. AIB's corporate banking department uncovered the issue last year before informing the authorities.
The SFO said the suspect provided guarantees of lease payments from a blue-chip property company which turned out to be false.
Companies linked to the alleged fraudster are said to have set up leases for longer periods and at higher rents than existing occupational tenants.
These additional leases increased the value of the properties involved, the SFO said.
AIB, which the SFO says is considering legal action against a 'number of parties' over its losses, is not commenting further on the investigation. It said: 'AIB identified the issue and referred it to the appropriate authorities.
The write-down was fully accounted for in our 2008 results.'
