Marie Farrell has said gardai threatened to prosecute her if she withdrew statements placing Ian Bailey near the scene of Sophie Toscan du Plantier's murder.
The Schull shopkeeper earlier claimed a detective investigating the killing in West Cork stripped naked and asked her for sex.
She is giving evidence in Ian Bailey's wrongful arrest action against the state.
Marie Farrell's evidence is that she believed gardai when they told her in 1997 that they knew Ian Bailey killed French film producer Sophie Toscan du Plantier.
She said she agreed to lie and place the journalist at Kealfadda Bridge near the murder scene – however years later she withdrew what she now says were false statements.
Today she told the court detectives had threatened that she'd be charged with wasting garda time if she changed her story.
Earlier the shopkeeper told the court that a detective, who had helped her make false statements, on one occasion stripped naked and asked her for sex.
The shopkeeper denied courting publicity in reference to an exclusive with the Irish Daily Mirror in 2012 but indicated she might bring her own action for damages.
This afternoon''s session has centred on Marie Farrell's evidence that in February 1997 gardai made her sign blank statements.
In an exclusive interview with the Irish Mirror she said they weren't blank they were filled out but she didn't read them.
This was after she'd agreed to falsely place Ian Bailey near the scene of Sophie Toscan du Plantier's murder because she believed gardai when they said they knew he was the killer.