The texts and emails to evening radio shows last Wednesday praising the honesty and seriousness of Eugene McErlean told their own story about the former chief auditor at AIB, and Ireland's best known whistle-blower.

The new Financial Regulator, just nine months in the country, had started to clean up some of the toxic mess by offering an apology to an Oireachtas regulatory affairs committee for the treatment by his office of McErlean up to the very recent past. McErlean, who until 2002 was the most senior internal policeman at Ireland's largest bank, had investigated questionable practices, including the trading by the bank of its own shares through secretive Caribbean centres, and had clashed with senior executives when they failed to repay ordinary customers whom the bank had fleeced over many years.

Repeating a pattern it used against its previous internal chief auditors, AIB trumpeted McErlean's departure in the same press release on the same day as it announced its clean-up of the $691m in losses created by rogue trader John Rusnak in the US, insinuating that McErlean was somehow at fault.

McErlean had already informed the regulator about his concerns about the overcharging scandal but the trained corporate lawyer – he had worked previously for British Airways in Heathrow – was obstructed by the authorities. He entered a Kafka-esque legal entanglement in which he was prevented from accessing the minutes of his own meetings held with the would-be regulators of Dame Street. The former regulators acted only when another AIB whistle-blower (who, the Sunday Tribune understands, continues to face hardships) came forward.

Though acknowledging his undoubted honesty and strength, McErlean was taking an ordinary person's view of an abnormal situation at AIB and the banks. What was highly abnormal had become commonplace.

Significantly, there is a direct link between the first estimates AIB and the banks gave of the amounts they fleeced from their customers and the estimates the bankers provided to Nama for their loan losses. At AIB alone, the overcharging estimates started at €14m and slowly became €65m. Last week, the new regulator told Michael Moynihan's economic and regulatory affairs committee that €88m had been so far repaid to its customers by AIB alone.

The patterns of early low estimates on overcharging and the escalating amounts for impaired loans given to Nama by banks are remarkably similar. Bankers' expertise is supposed to be in dealing with numbers. In the view of senior legislators and Nama, bankers failed to give a frank assessment of the amount of their loan losses -- right up to recent times. Banks will always screw up but a sign of a healthy financial system is that mistakes should be recognised.

Uniquely troubling in the AIB case was that it had long become the biggest untouchable bank. Bailed out in the1980s over its insurance losses, along with others in the 1990s it failed to collect the interest savings taxes owing to the state. All the time the bank was systematically overcharging its customers. The untouchable bank was allowed to do what it pleased by regulators.

There is an ironically upbeat note to McErlean's story. In recent weeks, the Co Antrim man has been invited to join the European Commission's high-powered panel in Brussels advising on how Europe will legislate and regulate the derivative products so disastrously produced by Wall Street. The suffering inflicted by failed regulators and a toxic bank in Ireland has left him well placed to assess how to control the toxic products the global banking industry dumped on ordinary citizens.