RBC's Countersuit Against Former CFO Nadine Ahn
The Royal Bank of Canada (RBC) has filed a countersuit against its former Chief Financial Officer, Nadine Ahn, asserting that she violated the bank's code of conduct. This legal action follows Ahn's lawsuit against RBC for wrongful termination, in which she claimed that "gender-based stereotyping" played a role in her dismissal and sought nearly C$50 million in damages.
Background of the Dispute
In April, RBC terminated Ahn following an internal investigation that revealed her alleged intimate relationship with Ken Mason, a subordinate executive. According to RBC, this undisclosed relationship led to Mason receiving preferential treatment, such as promotions and salary increases. Mason has also filed a lawsuit against the bank, seeking about C$20 million and denying any personal relationship with Ahn.
Whistleblower Allegations and Investigation
RBC's investigation was prompted by an anonymous whistleblower complaint. The bank examined electronic communications from its systems and discovered that Ahn and Mason frequently used both personal and work devices for communication. Their relationship reportedly began in 2013 or earlier, involving dates, poetic exchanges, and the use of coded language to arrange meetings.
Financial Implications
RBC claims that Ahn should repay approximately C$3.3 million related to various performance-based programs and the exercise of stock options. The bank alleges Ahn's decisions resulted in Mason's total compensation increasing by 58% across two fiscal years, and her promotion of Mason to vice president and head of capital and term funding in 2023.
Legal Proceedings
Ahn's and Mason's legal representatives have not yet commented on the countersuit. Ahn has defended herself by labeling the allegations as "patently false" and accused RBC of destroying her career and reputation.
RBC's Position
An RBC spokesperson expressed disappointment over the allegations being true, emphasizing that Ahn, once a highly respected executive, failed in her fiduciary duties by breaching the bank's code of conduct. RBC insists that all senior executives are obligated to adhere strictly to its conduct guidelines.
The legal battle highlights the importance of maintaining professional boundaries and the potential repercussions of violating corporate policies.
