American Savings Bank said yesterday it has settled a lawsuit by a 91-year-old customer who alleged that she was defrauded of hundreds of thousands of dollars by a former bank employee.

Terms of the deal were not disclosed but American Savings spokesman Craig Togami said the bank was "satisfied" with the agreement.

Lyle Hosoda, attorney for bank customer Ada Lim, said in a news release that the settlement terms were fair.

"We've reached an agreement to resolve our lawsuit with American Savings Bank," said Hosoda, who declined comment beyond his statements in the release.

"Ms. Lim recognizes that this was a unique situation and both parties are fully satisfied that the settlement is both amicable and fair. While we will not divulge the specific terms of the agreement, we appreciate the bank's willingness to put this matter to rest."

Lim sued the bank on Aug. 2, alleging that Marilyn De Motta, the operations supervisor at the American Savings Hawai'i Kai branch, took more than $600,000 from Lim and got her to sign a document saying most of the money was a loan.

Lim said that the bank didn't take the proper steps to address De Motta's conduct and attempted to cover up De Motta's actions to avoid reporting the alleged fraud to federal banking regulators.

De Motta did not return a call but she previously said that Lim authorized her actions.

The bank's chief executive officer, Constance Lau, denied last month that the bank engaged in a cover-up. Lau said the bank took prompt action by firing De Motta after it investigated the matter.

The settlement will not have a direct impact on a separate lawsuit by American Savings' former security director Bert Corniel, who alleged that bank officials told him not to report the Lim case and another instance of fraud to federal regulators as required by law.

Corniel said the bank was "aware of this situation as early as July 2004, but no disciplinary action (against De Motta) was taken." Corniel alleged the bank "attempted to cover up De Motta's fraud as a loan."

The FBI has questioned people involved in the lawsuits, and American Savings said it is fully cooperating with the FBI investigation. The FBI has declined comment on its investigation.

John Perkin, Corniel's attorney, said yesterday he's going ahead with collecting information related to the case and will begin questioning witnesses shortly.

"I don't think it has any significance in our case, but we're glad Ada Lim is going to be made whole," Perkin said.

Reach Rick Daysog at rdaysog@honoluluadvertiser.com.