Nomura worker represented by Morrish Solicitors found to have been unfairly dismissed by Employment Tribunal in landmark case

Nomura worker represented by Morrish Solicitors found to have been unfairly dismissed by Employment Tribunal in landmark case

David Sorensen of Morrish Solicitors has successfully represented a former investment bank employee over his unfair dismissal from Nomura in a landmark ruling.

The London Central Employment Tribunal has ruled that Giovanni Lombardo, a former executive director in Sales at Nomura International, has been unfairly dismissed and that the bank had not only failed to carry out a reasonable investigation into the events surrounding his dismissal, but that it also had a disciplinary process that was flawed.

Lombardo, pursued a claim against the Japanese investment bank when he was sacked after one of his clients, Invexstar, failed to honour its debts and went into administration, losing Nomura approximately $40 million in May 2015, the largest individual loss in the company’s history.

Lombardo said that he was blamed for mistakes made by others at the bank and that “there were serious defects in the disciplinary process”.

Invexstar’s manager and sole employee, Alberto Statti, had accumulated failed trades worth $666 million when Lombardo contacted him under pressure from his Nomura bosses. Statti said he “was waiting for payment internally”. Lombardo said in his statement that payment never came and Nomura dismissed him for failing to escalate concerns about Invexstar.

Statti had run two trading firms before setting up Invexstar. One, BLF Global Asset Management Ltd., collapsed in 2013 owing about £12m to creditors including JPMorgan Chase & Co. and Citigroup Inc. while the other, Bi-Elle Fund & Asset Management U.K. Ltd., ceased operations in 2008 with losses of £54m.

He claimed that Nomura staff had allowed Statti access to its electronic trading systems despite knowing that he had presided over another collapsed fund. “I wasn’t made aware of Alberto Statti’s prior history by anyone,” Lombardo said in his statement. As a result, he “was handed a client to manage that I was led to believe was sound and had passed all required on-boarding checks,” he said.

Nomura tried to defend their actions, accusing Lombardo of “gross negligence” and said they had “lost trust and confidence in him”. They stated that the process and sanction of dismissal “lay within the band of reasonable responses reasonably open to an employer in these circumstances.” However, Nomura also said in a witness statement that “the company had never established a point at which traders should escalate concerns about a client’s trades.”

The Employment Tribunal decided following a six-day hearing, that Mr Lombardo was unfairly dismissed by Nomura. The former employers were strongly criticised by the Tribunal stating that they “acted unreasonably in treating Mr Lombardo’s conduct as a sufficient reason for dismissal.” It also said that “the employer had not carried out a reasonable investigation that was fair to Mr Lombardo and the disciplinary process was flawed. The dismissal was unfair because the process had been defective from the outset and the procedural shortcomings were substantial.”

The case will now return to the Employment Tribunal for the Tribunal to make a decision as to the amount of compensation that should be paid to Lombardo.

David Sorensen, who is based at Morrish Solicitors’ Leeds office and represented Lombardo, said “it seems to me that Mr Lombardo has been made a scapegoat by Nomura and I’m delighted that the Employment Tribunal have upheld his claim of unfair dismissal”.

Upon hearing the decision, Lombardo said, “justice has been done finally, I still don’t understand why I’ve been treated like this from a bank where I was working for nine years, putting myself and my family at very financial risk. I had to relocate my whole family back to Italy as I was unable to find a new job in banking”.

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Mark Dugdale

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