A UBS employee overheard a Eurostar neighbor conversation and found out about a $ 15 billion deal. Now he and the bank will be fined

Image: Isriya Paireepairit | CC BY-NC 2.0

In mid-July 2014, an employee of the company Lazard Ltd. Vincent Le Stradic traveled by train from London to Paris. He and his colleagues discussed the upcoming deal - the purchase of the American provider T-Mobile by the French company Iliad SA, owned by billionaire Xavier Niel.
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His neighbor was a banker from UBS Alexander Zaluski (Alexandre Zaluski). He overheard the conversation of Le Stradika, and conveyed information about a possible deal to his superiors. As a result, UBS offered Nehl credit for the transaction.

The French Financial Markets Authority did not like this - now, as Bloomberg writes , fines for using private information threaten both UBS itself and its employee.

Details of the case

Le Stradique is one of Xavier Nehl’s closest advisors. During the negotiations during the trip on the Eurostar train, he used several smartphones. UBS employee Alexander Zaluski, who turned out to be his neighbor, was able to see several messages on the screen of the financier’s smartphone, and also heard his conversations about the deal being prepared.

Zaluski realized that the deal could be announced in two weeks. He could not fully understand the plans of Nyel and his company Iliad, so he contacted his colleague in the office, Christian Lesueur, who worked as head of telecom, media and technology for Europe, the Middle East and Africa.

He quickly organized a team of 12 UBS bankers who developed a loan financing proposal for Iliad.

Possible consequences

Despite the fact that none of the participants in the story made financial transactions that could be recognized as insider trading, the French financial regulator plans to punish Zaluski and UBS. The reason is that the company and its employee used information that they should not have received.

According to the representative of the French Financial Markets Authority, the department recommends imposing a fine in the amount of 45 thousand euros on Zaluski and fining 400 thousand euros on his boss, Christian Lesier. UBS Bank itself will have to pay a 1 million euro fine.

Information about the investigation of the data breach appeared after it became known that the French authorities filed charges against Iliad chairman Maxime Lombardini (Maxime Lombardini). He made deals with shares of companies shortly before the announcement that she offered $ 15 billion for a controlling stake in T-Mobile US.

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