A former managing director at EFG International is suing the bank for what he claims is unfairly being sacked. The case brings unwanted attention to the bank’s business with Russia’s wealthy and powerful.
Dmitri Rozanov (pictured below) is claiming that he was fired after blowing the whistle on alleged weaknesses in the bank’s controls and systems over dealings with risky transactions. The U.K. division of EFG, a Swiss-based private bank, also said that its own formal investigation did not confirm Rozanov’s allegations.
The Swiss private bank rejects Rozanov’s claim, saying he was let go because he was not a «significant rainmaker», according to a report by the «Financial Times» («FT»).
The bank didn’t add any comment to what reported on the «FT». The employment tribunal in U.K. is set to rule on the case in October.
EFG’s annual report for last year showed that the number of client relationship officers dropped to 644 at the end of 2017, from 697 from a year ago, due to the completion of their integration process plus «ongoing performance management efforts». Rozanov left EFG in September, according to his professional profile. The move hiked the average amount of assets under management per private banker by nearly 12 percent to 237 million Swiss francs ($313.5 million).
Rozanov, who left a job at Coutts to join EFG three years ago, flagged concerns about a proposed $100 million transaction involving an unidentified individual who has a relative in the Russian parliament. The individual wanted to deposit funds into an EFG client’s account to buy distressed assets.
As this transaction involved so-called politically-exposed persons, or PEPs, Rozanov said that the client relationship manager involved with the transaction failed to alert EFG’s Guernsey unit. As another EFG employee also spotted the issue, the transaction did not go ahead, the FT reported.
In another case, Rozanov said he had flagged concerns about an account move from Guernsey to EFG in Monaco, because the client’s father was an associate of Russian President Vladimir Putin.
EFG’s U.K. Chairman John Reed denied hearing from Rozanov, while Anthony Cooke-Yarborough, the bank’s U.K. head who likely would have been Rozanov’s boss, said he didn’t hear from the banker until after he was made redundant.
«His allegations were investigated thoroughly by the bank and were not upheld. EFG takes its regulatory responsibilities very seriously and is vigorously defending against the claim,» EFG said in a statement to the FT. Back in 2013, the bank paid 4.3 million pounds ($5.7 million) in Britain over failing to spot money laundering risk from 2007 to 2011.