RBC countersues former CFO Ahn, claims breach of code of conduct

By Nivedita Balu

TORONTO (Reuters) – Royal Bank of Canada filed a countersuit against ousted CFO Nadine Ahn on Friday, detailing findings of its internal investigation into her alleged intimate relationship with a subordinate, and accusing her of breaching its code of conduct.

Ahn last week sued RBC for wrongful termination and alleged that “gender-based stereotyping” was a factor in her dismissal. She has sued RBC for nearly C$50 million.

In April, RBC, Canada’s biggest bank, said it had terminated Ahn after its investigation found she was in an undisclosed close personal relationship with another executive, Ken Mason, that led to his preferential treatment including promotions and compensation increases.

Mason has also sued the bank for about C$20 million for wrongful termination and he has denied any close personal relationship with Ahn.

In its statement of defence and counterclaim filed with the Ontario Court of Justice, RBC said it received an anonymous whistle-blower complaint that Ahn and Mason were engaged in an intimate relationship.

RBC said it reviewed electronic communications maintained on its systems and found through its investigation that Ahn and Mason regularly used personal and work devices to communicate.

RBC’s court filing detailed Ahn and Mason’s relationship starting in 2013 or earlier highlighting their dates, poems written by Mason, intimate email exchanges and what the bank said was code they used to describe meeting for drinks.

RBC in its response said Ahn should repay RBC about C$3.3 million for payments related to its performance-based deferred share unit program, short-term incentive program and gains on the exercise of RBC stock options.

RBC said Ahn’s intervention led to Mason receiving total compensation increases amounting to 58% over two fiscal years starting in 2021, and that she made the decision to promote Mason as vice president and head of capital and term funding in 2023.

Lawyers for Ahn, 53, and Mason, 57, did not immediately respond to a request for comment on the countersuit.

In her wrongful termination lawsuit, Ahn said the bank’s allegations are “patently false” and her successes, career and reputation were destroyed in an instant by the bank.

A spokesperson for RBC said it had been disappointed to learn the allegations were true.

“Contrary to the statements of claim from Ahn and Mason, the investigation showed there was an undisclosed close personal relationship, and that Ahn misused her authority as CFO to directly benefit Mason,” the spokesperson said.