Jefferies Wants Bonuses Back From Bankers Poached by Cantor
(Bloomberg) -- Jefferies Financial Group Inc., stung by the poaching of an entire investment banking team by Cantor Fitzgerald LP, accused the brokerage of making a “concerted effort” to stop the ex-employees from repaying bonuses it says it’s due.
Jefferies is embroiled in a legal fight with rival Cantor that stretches from New York to Hong Kong after 26 of its bankers joined the brokerage in late 2017. Details of the case were disclosed Tuesday after Cantor lost an attempt to have the London lawsuit set aside on jurisdiction grounds.
The dispute stems from the resignation of the Jefferies employees, who almost all quit “on materially identical terms” at 11 a.m. London time on the same day in November 2017, according to the judge. A Jefferies lawyer said the firm believed Sage Kelly, its former star banker and now a senior executive at Cantor, was among those who lured the bankers and persuaded the team not to repay bonuses.
A lawyer for Cantor Fitzgerald in London declined to comment, and a Cantor spokeswoman in New York didn’t immediately respond to a message.
In the U.S., the brokerage has maintained that the repayment agreements between Jefferies and their former employees “are unlawful,” according to the judgment.
A spokesman for Jefferies declined to comment.
Kelly, who ran health-care banking at Jefferies, resigned in late 2014 after his divorce became tabloid news that riveted Wall Street. He joined Cantor Fitzgerald in 2016 to oversee its capital markets business.
He was soon joined by Anshu Jain, the former co-chief executive officer of Deutsche Bank AG, who was asked to build out the brokerage by taking share from larger rivals.
The London lawsuit was brought against Cantor Fitzgerald’s global and Hong Kong operations as well as three former employees. The case is also being pursued in Hong Kong and in the U.S., where Jefferies has brought 10 cases before an American tribunal, according to the English judgment.
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