Cantor Fitzgerald LP accused a fired Singapore-based derivatives trader of making a blackmail threat in an exchange of lawsuits between the brokerage and its former employee over his dismissal.
Gavin White, the former trader, sued in Singapore’s High Court for wrongful dismissal, claiming unspecified damages. Cantor, the New York-based independent broker-dealer, countersued for a repayment of a loan and a return of a portion of his wages. A closed hearing is scheduled for Aug. 15.
White, who had refused a 20 percent pay cut proposal in October, had said he might complain about alleged breaches by the brokerage in Australia, Cantor’s Singapore unit said in its counterclaim. Cantor denied there had been any breaches and said it had a right to fire him for gross misconduct. White threatened to damage the firm’s reputation which amounted to a threat of blackmail, the brokerage said.
“Mr. White strenuously denies that he made any such threat as alleged by Cantor,” his lawyer Pradeep Pillai said in a phone interview today. “He is eager to have his name cleared of the allegation of gross misconduct.”
In addition to denying having made the statements attributed to him, White said that any comments he made in October meetings to discuss his pay with his supervisor weren’t supposed to be used against him. Cantor breached a three-year employment contract by firing him in November, he said in the complaint.
Robert Hubbell, a spokesman for Cantor, declined to comment on the litigation.
Cantor proposed to cut White’s pay in October because his division was underperforming and the brokerage couldn’t sustain the “extremely high salaries” on the team, the firm said in court papers.
White was paid S$580,000 ($461,000) a year at Cantor. Cantor is seeking the return of S$297,576.
Moody’s Investors Service lowered Cantor’s credit rating to junk in October, citing “stubbornly high” compensation expenses and its expansion which has failed to sufficiently boost profit. Cantor said in November it disagreed with Moody’s conclusion as its financial performance had improved.
White joined Cantor in November 2011 as head of contracts for difference in Singapore. A contract for difference is a financial derivative that allows traders to take advantage of price differences in the underlying instruments.
He had previously been head of foreign exchange and contracts for difference trading Asia at MF Global Singapore Pte and started work with an Australian firm in June, according to court papers.
Cantor, run by Howard Lutnick, has sought to diversify revenue sources aside from its inter-dealer brokerage franchise.
The case is Gavin Charles White v Cantor Fitzgerald (Singapore) Capital Markets Ltd. S139/2013. Singapore High Court.