Sun, Jun 05, 2011 - Page 11 News List

‘Naked auditors’ case shows Wall Street not cured of sexism

By Susan Antilla  /  Bloomberg

Suzannah Troy shouts in protest in front of the townhouse in the Tribeca area of Manhattan, New York, where former IMF managing director Dominique Strauss-Kahn is being held under house arrest on May 26. Troy was complaining about the aquittal of two New York police officers who were accused of raping a drunk woman they had been called to help, and also about Strauss-Kahn being allowed out on bail and to stay in a luxury apartment.

Photo: AFP

Fifteen years after female brokers sued Smith Barney & Co in a lawsuit famously known as the Boom-Boom Room case, financial firms have set up harassment training, torn racy photographs from the walls and pulled the plug on -company-paid outings to strip joints.

Despite all that, the industry is far from cured of a male--dominated culture where women can be intimidated and underpaid for work equal to the guys. And a recent US Supreme Court decision could block future progress by limiting female plaintiffs’ access to court and forcing more cases into closed-door arbitration.

After the arrest of former IMF chief Dominique Strauss-Kahn on sexual-assault charges, details are emerging about an IMF culture so intimidating to some women that they decline to wear skirts at the office.

Other examples are bubbling up worldwide. Last month, a German newspaper revealed that a subsidiary of Munich Re, the world’s biggest reinsurance company, had hired 20 prostitutes to entertain 100 top insurance agents in Budapest in 2007. The company said the event violated its policy.

And it’s not just the actions of high-flying IMF chiefs or European insurers at issue. Such behavior exists in the far corners of Wall Street, as seen in the recent case of a former sales assistant at UBS Financial Services in Kansas City, Missouri. On May 3, a jury awarded her US$10.5 million, including punitive damages, for sexual harassment and retaliation, after a 16-day trial that had more references to breasts and male sex organs than you’s find in a romance novel.

Several jurors sat at the edge of their seats as they heard how a broker and defendant in the case put on the desk of plaintiff Carla Ingraham an article entitled “The vibrator: What’s all the buzz about?”

After the verdict, the firm said in a statement that it will “ensure to the best of our ability that this kind of conduct does not occur again,” and that it does not tolerate harassment of any kind.

UBS hasn’t decided whether to appeal, said a spokeswoman for the bank, Karina Byrne.

“Wall Street is the king of harassment,” says Greg-Patric Martello, who represented two women who sued a Uniondale, New York, brokerage firm for harassment and won US$1.1 million in an arbitration case last month at the Financial Industry Regulatory Authority. “I’ve never seen an industry like it.”

Every industry has its problems with discrimination. The US securities business, though, has been particularly slow to improve, in part the legacy of a system that shielded it almost entirely from the courts until 1999. That year, the Securities and Exchange Commission changed the rule that had forced discrimination claims by licensed securities employees to be heard by private, industry-run arbitration panels.

Today, many securities firms prevent employees from airing their complaints in court by requiring them to sign contracts obliging them to use arbitration. Women who are bound by such agreements are able to get into court only if a judge determines that they represent a class.

High-profile cases like the Smith Barney lawsuit had sneaked into court before 1999 through a loophole: Wall Street arbitration panels weren’t equipped to hear class-action cases, thus giving groups of women who joined in a class a back door into court.

That loophole is likely to close as a result of an April 27 Supreme Court decision in AT&T Mobility v Concepcion, in which the court said that AT&T could block a class-action suit and force customers into arbitration.

This story has been viewed 6157 times.

Comments will be moderated. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned.

TOP top