UBS Found Guilty of Harassing Whistleblowers in France, Court Rules

Key Takeaways

• Whistleblower Retaliation: UBS Group AG’s French unit, UBS France, was found guilty of harassing two whistleblowers who exposed the bank's role in aiding wealthy clients to evade taxes.
• Case Details: Nicolas Forissier, a former auditor, was penalized by UBS for reporting tax avoidance practices, including being denied a promotion to executive director. Stéphanie Gibaud was also targeted for her assistance to French authorities in a tax investigation.
• Financial Penalty: UBS Europe, which took over from UBS France, was fined €75,000, the maximum allowed by French law at the time. Forissier was awarded €50,000 in damages.
• Ongoing Legal Struggles: The harassment case is part of a broader legal saga involving UBS, including a conviction for money laundering. A French court has also opened the door to potentially reducing a €1.8 billion fine imposed on the bank.
• UBS's Response: UBS disagrees with the ruling, calling it “unjust,” and will review the decision to determine its next steps.

Deep Dive

In a courtroom drama that casts a sharp spotlight on UBS Group AG’s handling of whistleblowers, the Swiss banking giant was found guilty by a French court of retaliating against two employees who dared to expose its role in aiding wealthy clients to dodge taxes, according to a Bloomberg report.

The ruling centers on UBS France, a unit of the bank that has been under intense scrutiny for over a decade. The court’s decision unfolded like a legal thriller, with former auditor Nicolas Forissier at the heart of the case. Forissier had raised red flags internally about the bank’s questionable tax practices, but rather than being applauded for his courage, he was pushed aside. Despite his qualifications, UBS refused to promote him to the position of executive director, a move that the court deemed a clear act of retaliation.

“UBS was trying to bully its employee,” the lead judge declared, underscoring the severity of the actions taken against Forissier, who had trusted the bank with his concerns.

Stéphanie Gibaud, another whistleblower, also found herself in the crosshairs of the bank’s retaliation. Gibaud had provided crucial assistance to French authorities in tracking UBS clients during the 2011 Roland-Garros tennis tournament. Her role in helping expose tax avoidance didn’t go unnoticed by UBS, which penalized her for taking a stand against the bank’s activities.

As a result, UBS Europe, which took over from UBS France, was slapped with a €75,000 fine — the maximum allowable under French law at the time. Forissier was awarded €50,000 in damages for the suffering he endured.

But this isn’t the first time UBS has faced legal heat in France. The harassment case is just one chapter in a long-running saga that has already seen the bank convicted of money laundering in connection with its French operations. And while the dust is far from settling, the French top court recently opened the door for a potential reduction of a hefty €1.8 billion fine levied against the bank.

UBS, of course, isn’t backing down. In a statement following the ruling, the bank expressed its disagreement with the conviction, calling it “unjust,” and said it would be reviewing the decision before deciding its next move.

This case serves as yet another reminder of the risks whistleblowers face when they take a stand against powerful institutions — and of the lengths to which those institutions might go to protect their interests. For UBS, it’s a hard pill to swallow, but for the whistleblowers, it’s a small victory in their fight for accountability.

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