Headhunting in private banking is more often than not a delicate matter. By its very nature the movement of experienced professionals who have intimate access to their clients most confidential financial details, and their trust, can be rather complex and challenging.   

According to media reports over the weekend Brazil's BTG Pactual’s private-banking unit in Singapore, has been sued over claims it circumvented a headhunter’s introduction and rejected to pay the firm for introducing bankers.

Singapore firm Mancano and Associates is requesting $5 million for successfully referring 23 employees, including deputy chief executive officer Raj Sriram, to BSI Bank.

According to its amended lawsuit filed in the Singapore High Court, BSI circumvented Mancano and directly hired candidates the headhunter recommended from 2009.

A Common Understanding

BSI said in court papers that Mancano has no basis for its assertions and there was no binding agreement with the search firm.

Michael John Mancano the proprietor of Mancano and Associates said in court papers he and BSI’s Chief Executive Officer Hanspeter Brunner had worked together since 1997 to recruit bankers for Brunner’s then-employer Coutts Bank, and that both men had a «common understanding» and operated on trust.

No Accepted Practice

Hanspeter Brunner departed RBS Coutts to develop the BSI wealth management business in 2009, followed by about 70 employees in Singapore and Hong Kong.

There was no «accepted practice» between Brunner and Mancano as claimed, the headhunter has apparently been paid $250,000 for administrative work and no more payments are due, BSI said.

Selling the Bank

BTG purchased BSI in September from Italy’s Assicurazioni Generali for 1.25 billion Swiss francs ($1.25 billion).

Ironically it is now seeking to sell the private bank it just acquired to boost liquidity after the temporary arrest in Brazil of its billionaire founder Andre Esteves.

Legal spats in Singapore

In 2008 seven employees of Citibank who were on their way to join Swiss bank UBS were taken to court and charged with extracting confidential information from the bank's computer database. The seven were heavily fined and censured.  

British bank Barclays was sued in Singapore by a local recruitment firm in 2009 who claimed the bank had been «unjustly enriched» for failing to pay an introduction fee of $253,000 after it had hired a senior banker introduced by the firm. An out of court settlement was eventually agreed.