Ex-HSBC Trader Seeks €1.4 Million Over Broker-Fees Warning
A former HSBC Holdings Plc trader is demanding a €1.4 million ($1.5 million) payout from the lender in France, alleging it suddenly turned against him when he warned top bosses about a potential scandal over exorbitant brokerage fees.
Yoram Loeb, who managed a team focusing on exotic indexes, claims his career development at HSBC in Paris stalled after he took his concerns over “very large irregularities” in the levies to senior management in London.
Loeb’s local hierarchy initially asked him to look into the fees issue in late 2018, suspecting that two HSBC traders might have been implicated, his lawyer Alexandre Barbelane told the Paris employment tribunal on Monday. He said that Loeb reported back with his findings but after hearing nothing, decided to escalate the matter.
“That’s when Mr. Loeb’s unfavorable progression started,” Barbelane said. The lawyer produced a graphic for the judges he said shows the compensation of three others in comparable situations at HSBC overtook his client — including a €180,000 gap with one of them.
Barbelane claimed that in addition to being hit financially, his client also suffered negative reviews after handing in his report. “The goal was to undermine Mr. Loeb,” the lawyer said.
HSBC attorney Emmanuelle Arnould denied any retribution. She said his report was taken seriously and an internal investigation carried out between February and June 2019, during which Loeb was asked to testify.
“HSBC referred the matter to the Financial Conduct Authority at the end of 2018” and informed the UK market watchdog of the outcome of its investigation, said Arnould.
She added that “internal measures were taken within the company,” without further specifics. None of the lawyers mentioned the names of the brokerages that allegedly overcharged HSBC.
Some of the biggest names in British finance are currently in the FCA’s crosshairs. Its enforcement action against brokerages has included fining in 2022 three entities of BGC Partners Inc. £4.7 million ($6 million) over failing systems to detect market abuse.
The FCA declined to comment including on whether the Loeb report triggered a case. A HSBC spokesman also said it wouldn’t make any statement on the case.
During the Monday hearing, Arnould sought to depict Loeb’s lawsuit as opportunistic, saying that he’d never aired any of the pay grievances throughout his decade-and-a-half career at HSBC. The lawyer added that he cashed in a check worth more than €500,000 from the bank after signing up to a voluntary buyout plan.
Arnould disputed the relevance of the €180,000 pay gap Barbelane referred to. She said that person concerned wasn’t in a comparable situation as they had been collecting a special bonus intended to attract staffers back to France.
A ruling is expected on Oct. 21.