Citi says rehiring ex-trader after acquittal is non-starter

Bloomberg

Citigroup Inc said the prospect of rehiring a former trader after he was acquitted of rigging foreign-exchange markets last year is a “non-starter” following the “clearest possible breakdown in trust and confidence.”
Rohan Ramchandani was fired after a swift investigation by the bank into his chatroom messages and is suing the bank in an employment tribunal in London, asking to return. The 39-year-old has suggested working in roles in compliance where he could educate junior staff on “the perils of electronic communications,” Citigroup’s lawyer Simon Devonshire said.
Citigroup dismissed Ramchandani in early 2014 as regulators probed whether traders at the world’s largest banks colluded to use instant-message groups to manipulate benchmarks such as the WM/Reuters rates. Ramchandani was part of a message group known as “The Cartel” that was a focus of the investigation.
The employment lawsuit was restarted after a federal jury in New York rejected US charges that Ramchandani and two other senior traders
at Barclays Plc and JPMorgan Chase & Co rigged the market from 2007 to 2013 by
coordinating trades and manipulating prices on the spot exchange rate for euros and US dollars.
Citigroup has conceded that it didn’t follow its own dismissal procedures, but is contesting the compensation due to him.
Citigroup said it would be “completely unworkable” to employ Ramchandani again. The trader separately filed a lawsuit against the bank in Manhattan last month, claiming damages of $112 million for malicious prosecution, which the lender denies. Ramchandani has claimed that the bank fabricated evidence against him to protect itself.
Ramchandani is set to start giving evidence. He was paid 100,000 pounds ($129,000) a month in his old role as head of the bank’s EMEA G10 Spot FX trading.
The hearing is set to hear evidence from Citigroup executives including Jamie Forese, the bank’s former president. In the UK, an employment tribunal can order that a former member of staff be rehired.
Alternatively, winnings are typically capped at about 80,000 pounds unless employees can prove they were blowing the whistle or suffered discrimination.
The case has echoes of another one involving a British trader who was fired at the behest of an American regulator, and insisted at a tribunal that he wanted his old job back. David Fotheringhame, a former trader at Barclays, got a $1.2 million payout after winning his unfair dismissal suit when the bank refused to comply with an order to rehire him.
Citigroup “genuinely believed” that the trader’s conduct was wrongful, Devonshire said in a legal filing.
Ramchandani “gave the inappropriate appearance” of coordinating his trading with his fellow chatroom participants, he said. The bank said it still didn’t accept that all the chats are capable of legitimate
explanation.
Ramchandani said he was never given the chance to explain the messages and is owed compensation.
The ex-trader says that Citigroup never instigated a formal disciplinary process, and that his wife found out about his firing from a press article before he could tell her personally.