BLBG:Bank Sarasin Says Fired Employee Passed Data on Hildebrand Currency Trade
Bank Sarasin & Cie. AG (BSAN), the Basel, Switzerland-based private bank, said it fired an employee who passed data on currency trades by the family of Swiss National Bank Chairman Philipp Hildebrand to a political opponent.
The employee disclosed documents to a lawyer with close ties to the Swiss People’s Party who then arranged a meeting with Christoph Blocher, a former justice minister and current vice president of the party, according to a statement late yesterday from Sarasin. The data allegedly showed the sale of 500,000 Swiss francs for dollars by Hildebrand’s wife on Aug. 15, Zurich-based newspaper SonntagsZeitung reported.
The Swiss central bank rattled currency markets three weeks after the alleged trades, on Sept. 6, by imposing a ceiling on the franc’s exchange rate for the first time in three decades. Blocher called for Hildebrand’s resignation last year after the SNB posted a record loss in 2010 trying to restrain the appreciating currency. The franc has declined 8.8 percent against the euro since the cap was introduced.
“Bank Sarasin is extremely regretful about this incident and has apologized to the client for the considerable unpleasantness caused by the infringement of bank-client confidentiality,” the company said in the statement. Hildebrand was notified by the bank, according to the statement.
‘Ridiculously Cheap’
The SNB said Dec. 23 that an external probe into Hildebrand’s conduct showed he didn’t use privileged information for his personal enrichment before the bank set the franc ceiling of 1.20 versus the euro. The SNB Bank Council, its supervisory body, ordered the probe after it was advised by Hildebrand about the allegations.
Hildebrand’s wife, Kashya Hildebrand, said in a written statement published on Swiss television late yesterday that her “interest in the dollar purchase was motivated by the fact that it was at a record low and almost ridiculously cheap.” She also said that she had worked in the financial industry in the 15 years through 1999 before becoming an art dealer and “felt comfortable with this transaction.”
Dollar, Franc
The U.S. dollar appreciated 9.9 percent against the franc between the time of the trades and the central bank’s September announcement. Hildebrand, 48, hasn’t commented publicly.
The Swiss government said it was told last month about alleged currency transactions by Hildebrand. The Cabinet “was informed in December by an individual about alleged exchange transactions” by Hildebrand, “in particular about transactions in the foreign-exchange market,” government spokesman Andre Simonazzi said by e-mail Jan. 2.
Simonazzi said Hildebrand fully disclosed information about his own and his family’s bank accounts after learning about the allegations. The government investigation concluded that “there was no evidence of transactions that misused confidential information or breached SNB regulations,” he said.
Hildebrand joined the SNB’s governing board in 2003 after being chief investment officer at Zurich-based Vontobel Group and Union Bancaire Privee in Geneva. He became SNB president in January 2010.
Billionaire entrepreneur Blocher, 71, helped to transform the Swiss People’s Party from an agrarian group to a populist anti-immigrant party. He was ousted from the Cabinet in 2007.
After the central bank amassed a record loss of $21 billion in 2010 through foreign-currency actions aimed to fight deflation and help exporters, Blocher said Hildebrand should resign, calling the moves “senseless speculation.”
The Bank Sarasin employee, who wasn’t named, worked in information technology and passed the data to the lawyer, who then arranged a meeting with Blocher on Nov. 11, the bank said in the statement, citing the former employee. Livio Zanolari, a spokesman for Blocher, declined to comment.
The worker went to Zurich cantonal police on Jan. 1 and admitted criminal misconduct, according to the statement.
Bank Sarasin said it also informed the Swiss Financial Market Supervisory Authority and reserves the right to take legal action.
-- With assistance from Klaus Wille in Zurich. Editors: Dan Reichl, David Scheer
To contact the reporters on this story: Dakin Campbell in San Francisco at dcampbell27@bloomberg.net; Allison Connolly in Frankfurt at aconnolly4@bloomberg.net
To contact the editor responsible for this story: David Scheer at dscheer@bloomberg.net
