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HSBC sexual harassment case shows banks' struggles in MeToo era

People walk past a HSBC bank branch in midtown Manhattan in New York City. (PHOTO: REUTERS/Mike Segar)

By Stefania Spezzati

(Bloomberg) -- In the MeToo era, financial firms the world over are struggling to handle complaints of sexual harassment. A case in point: HSBC Holdings Plc.

The lender started a probe after a junior employee complained that she was sexually harassed by a senior executive at an upscale New York restaurant. Yet it allowed the banker, Thibaut de Roux, to speak at a town hall meeting in late August about conduct while the investigation was underway, according to people familiar with the matter. In his presentation streamed globally to thousands of the bank’s markets employees, he displayed a slide, seen by Bloomberg News, stating that "conduct is first a culture.”

HSBC’s sexual harassment investigation, carried out by the bank’s human resources department, took four months. The woman, who is in her 20s, was kept in the dark about the process despite several inquiries, the people said, asking not to be identified. She alleged that de Roux repeatedly rubbed her leg under a dinner table and engaged in unwanted petting, according to an email written by her and seen by Bloomberg News.

The bank said in September that de Roux was leaving and planning to retire. It didn’t provide any further details on the circumstances of his departure, but noted his significant contribution to its global markets business in his 28-year career at the bank. He was head of HSBC global markets, which sits within the investment bank and based in London.

The length of the investigation, the alleged treatment of the woman and the fact that he appeared to leave the bank on good terms raise questions about HSBC’s handling of the incident.

HSBC’s process seemed to speed up after a senior employee at the investment bank sent a note calling out de Roux’s behavior, according to the people. The memo to HSBC executives including Chief Executive Officer John Flint was sent after the town hall and following a conversation that the senior employee had with the woman, the people said.

“Hypocrisy has a way of upsetting people,” Mark Miller, head of institutional sales for the Americas in New York, wrote in the email seen by Bloomberg News, asking that HSBC take immediate action. “I for one never want to be lectured to by Thibaut again about conduct.” Flint responded to Miller that the bank was engaged in a process that could take some time, the people said. Miller, who left the bank shortly after de Roux, declined to comment when contacted by Bloomberg News.

Jezz Farr, a spokesman for HSBC, said in an email that the bank takes accusations of harassment seriously. “We conducted a thorough investigation into the allegations that were made and took appropriate steps based on the outcome,” Farr said. “These kinds of investigations take time.”

De Roux didn’t return calls and texts to his mobile phone seeking comment. The woman who made the accusations declined to be interviewed for this story.

During the sexual harassment probe, the bank let de Roux carry on with responsibilities such as meeting with Federal Reserve officials in late July, where he was the most senior executive representing HSBC, the people said.

Handling Misconduct

Reported cases of alleged harassment have spread throughout the business world, including finance, exposing weaknesses in some of the banks’ internal procedures and adding pressure on companies to improve their handling of misconduct claims. HSBC competitor Standard Chartered Plc has been sending memos to employees with the rubric #knowtherules.

“I will not accept behavior that violates a person’s dignity or erodes their self-respect,” Standard Chartered CEO Bill Winters warned in an April 2018 memo. A former London-based trainee at UBS Group AG who said she was raped by a more senior employee sued the lender in March, saying she suffered sexual discrimination and harassment. UBS said at that time an independent investigation into the allegations concluded the bank made “no fundamental errors,” while saying it was implementing some changes based on recommendations for improvement.

In the HSBC case, “the idea that they don’t tell the complainants what was going on, this lack of transparency, is so out of date and so wrong,” said Clive Howard, a lawyer at Slater and Gordon in London who has represented victims in sexual harassment cases. “And so is the fact that it went on for so long.”

Bloomberg News reported in December that de Roux left after misconduct allegations. The bank said at that time that it dealt with this case “directly, robustly and appropriately.’’ The bank wouldn’t comment about the compensation terms under which de Roux left.

Unwanted Touching

The night of the alleged incident last May, de Roux briefly attended drinks in New York to celebrate the promotions of several executives, the people said. He returned to HSBC’s office, where he invited the female employee to dinner, according to people with knowledge of the woman’s account who requested anonymity discussing personnel matters.

During the dinner at Ai Fiori restaurant, the woman was subject to alleged unwanted touching of her legs and hands, the people said. De Roux repeatedly asked her to meet again, according to the people.

The woman, an American who joined the bank as an analyst in 2016 and helped make arrangements for de Roux in New York, wasn’t a direct subordinate of his. The day after the alleged event, de Roux called her several times, asking her to bring documents to his office, the people said. Instead, she talked to a senior manager about the uncomfortable situation and left the office, according to the people.

The senior manager escalated the issue to the human resources department, which then interviewed the woman, according to the people. The human resources unit had informed her it would conduct an investigation, according to an email seen by Bloomberg News and sent by the female employee to senior executives including Samir Assaf, CEO of global banking and markets, Patrick Burke, HSBC’s U.S. CEO, and Stuart Levey, chief legal officer at the bank.

In the email to HSBC, the woman accused the bank of trying to protect de Roux. “Instead of information and action, I have been provided with a stream of excuses meant to minimize and justify his inappropriate behavior,” she wrote.

Investigation’s Progress

The woman wasn’t informed about the progress of the investigation, the people said. It’s not clear whether HSBC held a formal disciplinary hearing. A process of this kind is more serious than an investigation, and it usually results in a decision that can range from no consequences to dismissal, according to U.K. employment rules.

For “conscious or sustained behavior that results in instances of bullying, harassment or discrimination,” HSBC’s policy foresees termination or dismissal, according to internal documents seen by Bloomberg News.

HSBC reported the allegations to the U.K. Financial Conduct Authority, according to a person familiar with the matter. The FCA declined to comment.

The woman left HSBC in December. De Roux’s successor, Georges Elhedery, said in a memo to staff in March this year that the bank aims to create “the healthiest human system in global markets.”


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