It has been reported that, the arbitration forum operated by The Financial Industry Regulatory Authority (FIRNA) has ordered Barclays PLC to pay Mayank Chamadia, a former swaps trader, approximately $9 million in back pay after he quit during a regulatory investigation. Chamadia joined Barclays in 2004. Thereafter, according to the allegations he was put on administrative leave in June 2013 because his group was part of an industrywide investigation into certain manipulations of interest-rate swaps.
However, Chamadia was not the focus of the regulatory investigation nor was he accused of wrongdoing. During this time Chamadia received his base salary while on administrative leave but he made most of his money through bonuses tied to his trading activities. Without being able to trade bonuses would not be paid and his chances of being hired at another firm would decrease. By October 2013, he resigned to join Balyasny Asset Management. Thereafter, Barclays withheld his deferred compensation. In 2014 Chamadia demanded to be paid bonuses that would have vested after his departure.
The panel awarded Chamadia $3.7 million in deferred compensation for 2010-2012 that had vested by March 2014, plus interest with the total award adding up to about $9 million.
In addition to a base salary, brokers and traders receive significant bonuses from contractual agreements with their employer. Indeed, many types of financial professionals in the industry including traders, hedge fund managers, financial analysts, and portfolio managers are compensated in this manner. In many instances bonuses make up the majority of their overall compensation.