When Credit Suisse shuttered it’s US wealth management operations in 2015 they effectively forced hundreds of into ‘termination’ status. Attempting to paper over that truth with an agreement with Wells Fargo and a ‘promise to recruit’ architecture, Credit Suisse thought it had legally avoided massive amount owed in deferred compensation. Oops.
In arbitration hearings across the country Credit Suisse has been losing, and losing badly in deferred comp cases. There doesn’t seem to be any slowing of that momentum; in fact, the losing streak could be set to accelerate.
Per media reports of the latest Credit Suisse beating:
”In the Feb. 14 award, a three-person Financial Industry Regulatory Authority Inc. arbitration panel found Credit Suisse liable for a breach of contract involving Jonathan J. Galli, Paul T. Connolly, Alexander V. Martinelli and Christopher L. Herlihy.”
“The arbitrators awarded each of them compensatory damages, costs and attorneys’ fees. They also awarded Mr. Herlihy interest on his damages. The total award was $2,096,609. The arbitrators denied Credit Suisse’s counterclaim.”
Compensatory damages, costs and attorney’s fees. Ouch. Just another precedent setting layer for the next round of Credit Suisse and UBS arbitration hearing.
Of interest, noted Wall Street and securities law attorney, Brian Neville, said this on LinkedIn when the award was announced:
“Another win for Lax & Neville for former Credit Suisse employees. This is he fifth win with no losses and the seven win total against Credit Suisse.”
Why Credit Suisse doesn’t attempt to settle these claims en masse we can’t understand – but mounting and consistent losses are a terrible look. Seems that the old Animal House line is prescient for CS at the moment, “the beatings will continue until morale improves.”