A former foreign exchange trader fired by Royal Bank of Scotland said he was a scapegoat and that the state-backed bank had "dishonestly contrived" his dismissal to divert attention from its own failings. Ian Drysdale is claiming unfair dismissal in a London court after being sacked in February by RBS for gross misconduct. The bank says Drysdale shared in chatrooms confidential information about the trading activities of clients, including Russia's central bank, with traders at other banks.
"They had to find relevant scapegoats, of which I was one," Drysdale told a London tribunal hearing on Wednesday. RBS, which is 73 percent owned by the UK government, was fined 217 million pounds ($330 million) by Britain's financial regulator and $290 million by US authorities in November 2014, one of several banks given such penalties for failing to stop traders allegedly manipulating FX markets. "I believe the real reason for my dismissal was to deflect attention from the respondent's (RBS's) own admitted failures," Drysdale said in a witness statement.
He said RBS "deliberately and dishonestly contrived to dismiss me for reasons unconnected to my conduct". Drysdale said he had been advised there was no prospect he would be employed as an FX trader while his dismissal remained in place, due to the public fine for RBS and the way he had been connected to it. "I do not believe that a fair investigation was undertaken: a process was adopted entirely with the intention to dismiss me. Senior people in the respondent have colluded to give a different impression," he said.
Andrew Cross, RBS's director of enterprise-wide risk, who handled Drysdale's internal appeal after he was fired, said the dismissal was justified. "I didn't get any sense that the claimant adapted his behaviour at any point, despite a clear tightening of conduct standards across the industry," Cross said in his witness statement. Drysdale said he did not do anything wrong in the chatrooms. RBS said he used code words such as "red" for the Russian central bank, which disclosed trading information.
Cross said there had been a clear change in expectations and standards in the industry in recent years that required staff "to modify their behaviour. "He (Drysdale) was consciously doing things that were the wrong side of the line," Cross said. He said RBS looked at 79 individuals at all levels of the bank as part of its investigation into activity in the G10 spot FX business. Drysdale had been identified within the investigation and he was part of the first phase and the analysis and investigation is continuing, he said.
RBS has dismissed three employees and suspended two staff as part of its investigation. The hearing is due to continue on Thursday. Drysdale was one of several traders sacked in the wake of investigations into alleged FX market and Libor interest rate manipulation who are now suing banks for unfair dismissal at London employment tribunals. Earlier this month former Citigroup FX trader Perry Stimpson claimed he was unfairly dismissed, saying the sharing of client information was widespread and condoned by senior management at the time. Other former traders from Citigroup, Lloyds and HSBC have also filed claims.