Citigroup is still dealing with the fallout of a currency trading scandal from several years ago – however the lender recently scored a victory against former currency trader David Madaras, who was fired back in late 2014. Following a lengthy hearing, Madaras was found to have violated Citigroup’s code of conduct, striking down an employment lawsuit against the bank, according to a recent Bloomberg report.
The bank originally found itself in a legal battle with Carly McWilliams, David Madaras and Robert Hoodless, all entailing illegal dismissal – Mr. Madaras to date is the only individual of the four to have lost his lawsuit against Citigroup. Each of the cases were closely related to the foreign exchange (FX) market scandal, which had previously convulsed the foundations of the FX market as the corporate balance sheets of major banks.
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The litany of hearings over the past few years also illustrate another side of the previous currency rates fixing scandal. There was always a potential danger for a precedent being set with regards to axing of employees, ultimately demonstrating that banks have not been thorough in their assessment of the role of their employees in the FX fixing scandal. While these fears never materialized, Citigroup for its part did manage to close the door on at least one of its ongoing lawsuits.
Victory for Citigroup
Mr. Madaras was originally a Citigroup currencies trader that was fired back in December 2014 after he appeared to validate a rival trader’s disclosure of a client name. Additionally, he also revealed the price of the client’s trade, disclosing further information in a blatant use of misconduct.
The messages themselves date back to 2011 messages on the Bloomberg terminal following a dissemination and of traders’ electronic chats amid, driven in large part by regulatory scrutiny. Mr. Madaras is the lone case out of the original group of former employees to have resulted in a victory for Citigroup. A judge had previously ruled in the case of the other cases that Citigroup was too hasty to dismiss staff as a result of regulatory scrutiny.