SINGAPORE, Feb 28 (Reuters) – Two former UBS AG traders in
Singapore are suing the bank for wrongful dismissal, saying the
bank fired them to lessen its role in the alleged manipulation
of reference rates used to price currency derivatives known as
non-deliverable forwards.
In separate lawsuits filed at Singapore’s High Court on
Wednesday, Mukesh Kumar Chhaganlal and Prashan Parmeshwar Sunny
Miripuri said UBS never gave them full details of what
they were alleged to have done wrong. UBS declined to comment.
UBS was fined $1.5 billion in December last year for its
role in a multi-year scheme to manipulate the London interbank
offered rate (Libor) and other benchmark interest rates.
“It appears to the plaintiff that his summary termination
was effected in order to mitigate the defendant’s (UBS) role in
the growing scandal related to alleged fixing of reference rates
in the Singapore market,” papers in Kumar’s case say.
Kumar, who was the former co-head of Macro Trading, Emerging
Markets Asia, and Miripuri, who ran UBS’s South East Asian Desk
for NDF trading, were both fired on Feb. 7 having been suspended
since last year.
Both men said in the papers that UBS never gave them full
details of why they were being suspended and subsequently fired.
“They were not presented with any evidence showing they
fixed rates,” said Daniel Chia, a director at Stamford Law
Corp., which is representing the traders. “UBS cannot pinpoint
what they did wrong.”
A spokeswoman for UBS in Singapore said the bank is
declining to comment on the case as the investigations into the
alleged manipulation of reference rates are still ongoing.
Kumar did not comment beyond what he said in the court
documents when Reuters spoke to him via telephone.
Miripuri could not be immediately reached for comment.
The Monetary Authority of Singapore ordered banks that help
set local interbank lending rates and NDF rates to review the
fixing process last year as U.S. and British regulators cracked
down on manipulation of Libor, a benchmark used to set interest
rates for around $600 trillion worth of securities.
NDFs are derivatives that let companies and investors hedge
or speculate on emerging market currencies when exchange
controls make it difficult for foreigners to participate
directly in the spot market.
The biggest banks in the Asian NDF markets include UBS,
JPMorgan Chase & Co, DBS Group Holdings Ltd
and HSBC Holdings Plc.
