Stephanie Gibaud was a high-flyer in public relations and, after stints with the American Embassy in Paris and several Middle Eastern investors, ended up working in a lucrative role at global asset management firm UBS.
In June 2008, Gibaud was asked by one of her managers to destroy computer files relating to customers with offshore bank accounts in Switzerland. This was in the aftermath of a scandal that had engulfed the bank the year before, when American banker Bradley Birkenfeld disclosed information to the US Department of Justice that suggested UBS was facilitating tax evasion – ultimately leading to a fine of $780 million.
As Gibaud told Disruption Banking in an interview last year, “the top management” of UBS responded to the scandal by “reorganising the whole bank […] many colleagues were asked to delete their files, and empty their desks and cupboards.” However, she was concerned about the potential illegality of the request and deemed it to be professionally unconscionable in any case. Her manager would not commit her verbal order to writing – Gibaud simply ignored it.
Following this, Gibaud reported what had happened to UBS management and to the regulators in France. UBS then tried to fire her as apart of a mass redundancy after the 2008 financial crisis, but the French Ministry of Work refused to permit the redundancy as Gibaud was “an elected member of employees.” This led UBS into an extraordinary position in which they decided to sue Gibaud for defamation despite the fact she remained an employee.
UBS lost all their defamation cases against Gibaud. Her disclosures led to UBS receiving a record fine of €4.5 billion in 2019. However, throughout the process, Gibaud received very little support from the authorities in France and has been financially ruined by the costs of defending herself.
“Do you know what the compensation for defamation is in France? Zero. The court just says: “you were right, you didn’t defame anybody, and that you were absolutely harassed by this bank.” But you get nothing.”
Gibaud has since become a prominent campaigner on whistleblower rights and is seeking greater protection for whistleblowers from the French government. She recently wrote an open letter to the French Prime Minister, Elisabeth Borne, in which she expressed concerns that the existing legislation on the issue is not fit for purpose.
As she wrote, “whistleblower status was officially recognised in 2022 by “Le Défenseur des Droits” status on the basis of the law for the protection of whistleblowers, known as the Waserman law.” This is designed to provide a legal framework to protect whistleblowers from the financial and reputational consequences associated with exposing wrongdoing. Sylvain Waserman, the French politician who initiated the reforms, branded the law “the best protection for whistleblowers in Europe.”
However, the court has refused to grant Gibaud the compensation she should be entitled to under this law on the basis that “the administration did not make use of the information provided by Mrs Gibaud after 1st January 2017,” which is outside the (arbitrary) time limits imposed by the Waserman law.
This is highly unjust – why should Gibaud be denied compensation on a debatable technicality when, as she wrote, “all the required work had been done?” It sets a worrying precedent for future whistleblowers that the government may be able to wriggle out of paying compensation, leaving the whistleblowers themselves to deal with the financial fall-out.
As Gibaud wrote along with her lawyers, “the work carried out by Mrs Gibaud must be considered out of the ordinary in terms of the scale, duration and, in the end, the amount of the penalty imposed on the bank: €1.8 billion. The evaluation of this work transcends the restrictive time frame to which the Minister opportunely, and with a degree of cynicism, wishes to limit it.”
The French government, who used Gibaud as a key source to expose wrongdoing at UBS, have behaved extremely poorly. This is not just an injustice against Gibaud – serious though that undoubtedly is. It also makes it less likely that employees will expose illegal or immoral behaviour at their firms in the future. Why would they when they have seen, with Gibaud’s experience, what the consequences can be?
Her lawyer concludes the open letter: “witnesses of criminal acts, or even corruption, will henceforth remain silent. What lesson or stern warning does one want to send to other citizens by the example of such an injustice inflicted on Mrs Gibaud?”
“Potential whistleblowers will remain silent, accepting to transgress their moral principles and ethics for fear of the consequences, of reprisals, of being ostracised from society.”
Author: Harry Clynch
#UBS #Whistleblowers #France #Banking #AssetManagement
