Baltimore casualties

Trading scandal: Housecleaning tries to restore faith in Allfirst, but at considerable cost locally.

March 18, 2002

LAST MAY, Allied Irish Banks was alerted to suspiciously high trading levels at its Baltimore-based Allfirst Financial Inc. A brief investigation prompted assurances nothing unusual was going on.

Ever since last month, when Allfirst finally suspected fraud had triggered $691 million in losses, it has been clear that heads would roll. But AIB's Dublin headquarters would have to move quickly to ensure that nothing would undermine confidence in the Baltimore bank, which is fundamentally sound. The housecleaning at Allfirst on Thursday achieves those goals, but with considerable pain for Baltimore.

David Cronin, Allfirst's treasurer, who ignored warning signs last May, was fired, along with five other managers. CEO Susan C. Keating will stay on for now.

Significantly, a troubleshooter from Dublin was installed over her. What's more, as indicated in a Sun article yesterday, there are still important questions about the culture at Allfirst and whether even more personnel changes may be necessary.

Over the past two decades in Baltimore, the number of influential corporate executives who double as effective civic leaders has steadily declined. This is why the retirement in June of Allfirst Chairman Frank P. Bramble comes as a jolt. As a longtime executive with various banks, he has been a tireless promoter of the city..

He will be difficult to replace.

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