JPMorgan Trader Fired for Metal Mispricing Loses Lawsuit
Stock Chart for JPMorgan Chase & Co (JPM)
A former JPMorgan Chase & Co. (JPM) commodities trader, fired for mispricing aluminum trades, lost a lawsuit against the bank when a London judge ruled he couldn’t explain why the errors had all been profitable.
Daragh Nott, who was fired in September after the bank found as many as 90 erroneous trades, sued for unfair dismissal at an employment tribunal saying he had made honest mistakes as a result of the pressures of his job.
Nott “failed to answer adequately why the large number of errors he had made on the aluminum book all favored his” account, adding about $400,000 to his 2010 trading profits, according to an Oct. 17 written decision from employment judge A. Isaacson.
Investment banks have reduced bonuses, shed jobs and increased scrutiny of staff in the wake of losses from the 2008 financial crisis, leading to a rising number of employment disputes in London courts and tribunals.
Nott’s lawyer Richard Woolmer said his client was disappointed with the decision and was reviewing the judge’s findings. JPMorgan spokeswoman Kate Haywood declined to comment on the ruling.
The New York-based bank in March won a case in which a currency trader sought about 580,000 pounds ($935,000) over a missing decimal point in his contract. Commerzbank AG was ordered in May to pay 50 million euros ($65 million) to more than 100 Dresdner Kleinwort bankers who sued after the lender slashed bonuses.
JPMorgan found after an internal probe that the odds of all Nott’s mistakes benefiting his trading book were as much as a- trillion-to-one, Isaacson said in her judgment.
At a hearing in September, Nott admitted to making “numerous errors across all books due to the nature of,” and pressures that went with, his job. He said his health suffered as a result of being fired and the internal company appeal process he used to try to get it back.
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