Yorkshire lawyers win landmark unfair dismissal claim against Japanese investment bank

A YORKSHIRE law firm has won an unfair dismissal case for a former employee of a Japanese investment bank who was sacked after one of his clients failed to honour its debts and went into administration, resulting in the bank’s largest individual loss in its history.

Giovanni Lombardo pursued a claim against the bank when he was sacked after Invexstar lost Nomura around $40 million in May 2015.

Mr Lombardo said that he was being 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 $666m when Mr Lombardo contacted him under pressure from his Nomura bosses.

Mr Statti said he “was waiting for payment internally”. Mr Lombardo said in his statement that payment never came and Nomura dismissed him for failing to escalate concerns about Invexstar.

Mr 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 Alberto 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,” Mr 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.”

Nomura tried to defend their actions, accusing Mr 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 Mr Lombardo.

David Sorensen of Morrish Solicitors, which has offices in Leeds, Bradford, Yeadon and Pudsey and represented Mr 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.”