When a Wall Street executive is fired, it is usually done quietly.
The New York Times reports that a recent arbitration award has now shed a light on a termination that has caused an embarrassment for the bank.
The Royal Bank of Scotland’s United States securities division botched the firing of a former executive so badly that a Financial Industry Regulatory Authority arbitration panel ordered the bank to pay him $2.05m in compensatory damages. The panel, in the decision last month, also ordered the bank to retract his termination and expunge his regulatory record of defamatory comments.
Lawyers who follow securities industry arbitrations say they were surprised by how severely critical the decision was of the bank.
According to the arbitration panel’s case summary, the reason for the Royal Bank of Scotland to fire the executive, he claimed, was to distract people from finding out about “significant internal turmoil” within the bank.
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