Sacked Barings head 'was promised bonus of pounds 500,000'

A former Barings executive yesterday revealed how a director told her not to spend her promised pounds 500,000 bonus all at once, only hours before rogue trader Nick Leeson brought the merchant bank to its knees.

American-born Mary Walz, 36, told an industrial tribunal she was handed a slip of paper confirming her huge bonus and was praised as "a star" by Andrew Tuckey, deputy chairman of Barings.

But the next day news broke of Leeson's disastrous pounds 830m losses in Singapore and Ms Walz never got the cash, the hearing was told. Two months later Ms Walz, criticised in the Bank of England's report into the scandal for not monitoring Leeson, was summoned to the Barings' boardroom and sacked. She was then told that the bank could not afford to pay her bonus.

Ms Walz argued that the bonus had been decided weeks before the bank's collapse and that she was informed of her windfall the morning before Leeson's activities came to light.

She told the hearing in Stratford, east London: "Mr Tuckey handed me a slip of paper with my name and pounds 500,000 written on. He then said, 'Mary, what can I say? You're a star'.

"He continued with comments about how everyone was pleased with me. He said that the company recognised I was handling the department very maturely. He then said: 'Don't spend it all at once please'."

Ms Walz claimed that annual bonuses had never been linked to the bank's profits and that the amount paid in bonuses could not be changed. She said: "No one told me they had the right to change the bonus or that if they did they had any grounds to exercise that right.

"The bonus scheme was critical to the morale of staff and was not related to profits. I had a follow-up call from Mr Tuckey in which he told me how well I had done. I wouldn't have expected that if the bonus figure was only provisional."

Nicholas Underhill, QC, counsel for Barings, described Ms Walz's claim for the outstanding bonus as "surprising".

He said: "What is surprising is that Barings' global head of derivatives should claim she was entitled to a bonus in respect of a period in which Barings derivatives in Singapore had made catastrophic losses that drove the bank into insolvency.

"Leeson reported to different people at different times but she had some responsibility for him, if not in every respect. It is quite incredible that she could have had any expectation of a bonus at that time.

"No other Baring employee got their bonus under the profit-related scheme after the collapse. Only those employees retained by ING received retention bonuses equivalent to the original figures. This was to keep those members of staff at the company."

Ms Walz was awarded a pounds 160,000 bonus in 1992 and pounds 300,000 a year later. She was dismissed along with 20 other managers in July 1995, after being criticised in the Bank of England report for not checking on Leeson's trading. Leeson is serving a six-and-a-half-year jail sentence in Singapore.

Employees retained by ING after it bought Barings for pounds 1 received bonuses totalling pounds 90m. Ms Walz is claiming pounds 500,000 in outstanding bonuses. The hearing was adjourned until today.

News
Russia Today’s new UK channel began broadcasting yesterday. Discussions so far have included why Britons see Russia as ‘the bad guy’
news

New UK station Russia Today gives a very bizarre view of Britain

Voices
Left: An illustration of the original Jim Crowe, played by TD Rice Right: A Couple dressed as Ray and Janay Rice
voices

By performing as African Americans or Indians, white people get to play act a kind of 'imaginary liberation', writes Michael Mark Cohen

Arts and Entertainment
music
Life and Style
fashion
PROMOTED VIDEO
Arts and Entertainment
Hand out press photograph/film still from the movie Mad Max Fury Road (Downloaded from the Warner Bro's media site/Jasin Boland/© 2014 Warner Bros. Entertainment Inc.)
films'You have to try everything and it’s all a process of elimination, but ultimately you find your path'
Arts and Entertainment
Imelda Staunton as Dolores Umbridge in the Harry Potter films
books

New essay by JK Rowling went live on Pottermore site this morning

News
people

Top Gear presenter is no stranger to foot-in-mouth controversy

Travel
travel
News
people
Voices
Jules and Delaney
voices
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

The benefits of Recruitment at SThree...

£18000 - £23000 per annum + Comission: SThree: SThree, International Recruitme...

Trainee Recruitment Consultants

£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...

Finance Assistant - Part time - 9 month FTC

£20000 - £23250 Per Annum pro rata: Clearwater People Solutions Ltd: Pro rata ...

Marketing Manager

£40 - 48k + Benefits: Guru Careers: We are seeking a Marketing Manager to join...

Day In a Page

The drugs revolution starts now as MPs agree its high time for change

The drugs revolution starts now as MPs agree its high time for change

Commons debate highlights growing cross-party consensus on softening UK drugs legislation, unchanged for 43 years
The camera is turned on tabloid editors in Richard Peppiatt's 'One Rogue Reporter'

Gotcha! The camera is turned on tabloid editors

Hugh Grant says Richard Peppiatt's 'One Rogue Reporter' documentary will highlight issues raised by Leveson
Fall of the Berlin Wall: It was thanks to Mikhail Gorbachev that this symbol of division fell

Fall of the Berlin Wall

It was thanks to Gorbachev that this symbol of division fell
Halloween 2014: What makes Ouija boards, demon dolls, and evil clowns so frightening?

What makes ouija boards and demon dolls scary?

Ouija boards, demon dolls, evil children and clowns are all classic tropes of horror, and this year’s Halloween releases feature them all. What makes them so frightening, decade after decade?
A safari in modern Britain: Rose Rouse reveals how her four-year tour of Harlesden taught her as much about the UK as it did about NW10

Rose Rouse's safari in modern Britain

Rouse decided to walk and talk with as many different people as possible in her neighbourhood of Harlesden and her experiences have been published in a new book
Welcome to my world of no smell and odd tastes: How a bike accident left one woman living with unwanted food mash-ups

'My world of no smell and odd tastes'

A head injury from a bicycle accident had the surprising effect of robbing Nell Frizzell of two of her senses

Matt Parker is proud of his square roots

The "stand-up mathematician" is using comedy nights to preach maths to big audiences
Paul Scholes column: Beating Manchester City is vital part of life at Manchester United. This is first major test for Luke Shaw, Angel Di Maria and Radamel Falcao – it’s not a game to lose

Paul Scholes column

Beating City is vital part of life at United. This is first major test for Shaw, Di Maria and Falcao – it’s not a game to lose
Frank Warren: Call me an old git, but I just can't see that there's a place for women’s boxing

Frank Warren column

Call me an old git, but I just can't see that there's a place for women’s boxing
Adrian Heath interview: Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room

Adrian Heath's American dream...

Former Everton striker prepares his Orlando City side for the MLS - and having Kaka in the dressing room
Simon Hart: Manchester City will rise again but they need to change their attitude

Manchester City will rise again but they need to change their attitude

Manuel Pellegrini’s side are too good to fail and derby allows them to start again, says Simon Hart
Isis in Syria: A general reveals the lack of communication with the US - and his country's awkward relationship with their allies-by-default

A Syrian general speaks

A senior officer of Bashar al-Assad’s regime talks to Robert Fisk about his army’s brutal struggle with Isis, in a dirty war whose challenges include widespread atrocities
‘A bit of a shock...’ Cambridge economist with Glasgow roots becomes Zambia’s acting President

‘A bit of a shock...’ Economist with Glasgow roots becomes Zambia’s acting President

Guy Scott's predecessor, Michael Sata, died in a London hospital this week after a lengthy illness
Fall of the Berlin Wall: History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War

Fall of the Berlin Wall

History catches up with Erich Honecker - the East German leader who praised the Iron Curtain and claimed it prevented a Third World War
How to turn your mobile phone into easy money

Turn your mobile phone into easy money

There are 90 million unused mobiles in the UK, which would be worth £7bn if we cashed them in, says David Crookes