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SocGen Banker Fired in Insider-Trading Case Loses Bonus Bid

Gaspard Sebag

(Bloomberg) -- A former Societe Generale SA banker fired over allegations he took secret information on a $10 billion chemical deal and shared it with a friend lost a second bid to get about 430,000 euros ($473,000) in compensation related to his dismissal.

The Paris court of appeals rejected the claims by Stephane Fima, who was dismissed in 2016 for gross misconduct after police raided his office at the bank’s headquarters in western Paris. The former specialist in acquisition financing had already lost his first case two years ago. He was seeking severance pay as well as a 130,000-euro bonus for 2015.

“Stephane Fima, an experienced employee, knowingly breached his duties regarding professional secrecy and the access to confidential data,” the court said in a Nov. 6 ruling released this week. “These facts are tantamount to gross misconduct, making it impossible for the company to keep the employee.”

Fima is among seven men who have been charged in France for trading on inside information about the 2015 takeover of U.S. chemical producer Airgas Inc. by rival Air Liquide SA. The men have challenged the charges, and no trial has been ordered. French investigators say they have evidence two Geneva traders used a middleman who was friendly with the former SocGen banker to get confidential details on the Airgas acquisition such as the target price. There may be some overlap between the traders in the French case and a U.S. probe that resulted in six people being indicted last month.

Fima failed to convince appellate judges that Societe Generale didn’t act within two months of learning of the alleged infringements, as required under French employment law. While the raid took place on Jan. 14, 2016, the procedure to fire him only began on March 17. But the Paris court of appeals considered SocGen didn’t have a full picture of Fima’s breach of duty until police investigators shared their preliminary findings with his boss in mid-February.

Frederic Gras, a lawyer for Fima, said his client would need to consult an attorney who can plead at France’s top court to determine whether an appeal will be filed. SocGen said in an emailed statement the court acknowledged the dismissal was justified.

In a separate ruling released this week related to the insider-trading probe, the Versailles court of appeals upheld a 2014 raid by civil investigators at the office of a Paris lawyer specializing in mergers and acquisitions. Patrick Jaïs failed to convince judges that, on the day of the raid, he should have been given a copy of a lengthy document detailing the reasoning behind the action as well as the search warrant.

Investigators at the Autorite des Marches Financiers hoped the raid would shed light on the trading activities of a longtime friend of Jaïs. But the inspections turned up just one document, which Jaïs’s lawyer said was “so insignificant” he voluntarily provided it.

An attorney for Jaïs said his client had challenged the raids out of principle and losing the lawsuit would have been a blow to the AMF. It may have required investigators to provide both documents during subsequent inspections. Jaïs didn’t respond to requests to comment on last month’s ruling.

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To contact the reporter on this story: Gaspard Sebag in Paris at gsebag@bloomberg.net

To contact the editors responsible for this story: Anthony Aarons at aaarons@bloomberg.net, Alan Katz

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