- The Observer,
- Sunday May 26 2002
Credit Suisse Securities is being sued by a former trader who alleges he was sacked after claiming that the firm faced possible meltdown.
Russell Johnston, a bond trader for 20 years, has also launched an employment tribunal action against the London brokerage firm, a sister company of investment bank Credit Suisse First Boston (CSFB).
Johnston claims he was unfairly dismissed last year after telling his bosses he believed the firm was in danger of mis leading the Securities and Futures Authority over its potential liabilities. He says he felt they had seriously underestimated the difficulties of selling a number of large bondholdings.
Credit Suisse Securities declined to comment on the case this weekend, but is understood to deny all of Johnston's claims. His tribunal case is scheduled for September.
Johnston, 43, is also suing the firm in the High Court for breach of contract, and is demanding a six-figure sum in compensation, equivalent to a year's salary plus bonus.
He is understood to claim in court papers that Credit Suisse Securities negligently failed to provide him with a reference for his next job, at Bank of America Securities. As a result, he says, he was forced to leave BoA, and has not worked as a trader for a year.
Johnston is also demanding damages for slander, claiming that a senior Credit Suisse employee denigrated him in a telephone conversation with BoA. The legal claims come at a bad time for the Credit Suisse group, which reported a 73 per cent drop in first-quarter profits this month. CSFB recently axed 2,500 jobs.
Like other investment banks, it is being questioned by US authorities over the conduct of its analysts during the dotcom boom.
The Observer revealed last February that a former CSFB employee was the alleged leader of an insider-dealing ring being investigated by City of London police.
