Ulster Bank has admitted it hired private detectives to spy on the homes of two Co Londonderry brothers it is fighting in a legal battle over a major land deal.
Solicitors for the bank have written to Michael and John Taggart defending its actions.
The brothers are being sued by Ulster Bank over an alleged failure to honour a personal guarantee when they paid £15m for land at Kinsealy in north Dublin.
They are counter-suing the bank for around £80m, claiming it acted unlawfully in shutting down their property business empire.
Michael Taggart said he was "absolutely horrified" to find a man with a long lens camera taking pictures and videos of his home at Drumsurn, Co Derry, from a nearby field.
"I have three children under the age of five and they were outside playing," he said. "That's probably what annoyed me most. I had relatives from Co Meath staying here as well and it was very intimidating. I was also followed by two men in a car on a number of occasions over the past few days and my brother John and his grown-up daughter have been photographed as well."
The ongoing legal case has been adjourned as John Taggart has been unwell recently.
Solicitors representing Michael Taggart wrote to the Ulster Bank last Tuesday to complain about the private detectives. Solicitors Arthur Cox wrote back to the Taggarts on Thursday defending the actions of the snoops.
"Given the history of the matter, it will come as no surprise that Ulster Bank engaged investigators to carry out surveillance of Mr John Taggart... such a step is, of course, lawful and those undertaking surveillance on behalf of the bank have not acted unlawfully," said Mr Cox, Ulster Bank's Belfast lawyer.
"We are instructed that those involved in the surveillance for the bank did not use long lens cameras nor were they 'lurking in hedges'."
Mr Cox then went on to criticise Michael Taggart for his appearance earlier this month on a BBC Spotlight investigation into allegations that Ulster Bank deliberately closed down viable businesses to generate profits. Michael Taggart said the surveillance of him and his family members was a "new low" in his legal battle with Ulster Bank.
In the legal battle, the bank claims the farmer's sons signed a personal guarantee on the Co Dublin investment to the tune of £3.5m.
The brothers say this was paid off by June 2007 and when they signed a raft of documents six months later they didn't realise that guarantee had been resurrected.
Ulster Bank went to court in Belfast and won summary judgment against the Taggarts for the Kinsealy 'guarantee' and a second £5m personal guarantee over property in Northern Ireland.
However, the Taggarts appealed and won two cases against the bank with a full hearing of both sides' claims set for November.