Muslim twin sisters have won a multi-million pound settlement after making claims of sexual harassment and the widespread use of prostitutes and drug abuse in the City.
Samira and Hanan Fariad, 31, had made sensational claims that top brokers took clients to a lap-dancing club and bought drugs and prostitutes.
The sisters alleged that they suffered sustained campaigns of sexual harassment and unbearable levels of race and religious discrimination.
The pair made 200 separate allegations against the bank but the tribunal heard that the “sexual element of their allegations” was the “centrepiece” of their claim.
A tribunal heard that the women had warned that their claims would hurt former employer Tradition Securities and Futures “big time”.
It was told that that they were planning to reveal that “there are drugs and prostitution within Tradition”.
Their evidence was due to have started this week and had been expected to cause massive embarrassment to the City at a time when the industry’s reputation is at an all-time low.
The hearing was due to last a record 55 days at Central London Employment tribunal.
But the case was dramatically halted after Tradition agreed an out-of-court settlement in return for the women signing confidentiality clauses.
It is believed that the French twins, who both earned six-figure sums, secured a multi-million pound payout after demanding up to £10million in compensation.
Tradition spent hundreds of thousands of pounds on legal fees and tried in vain to prevent any reporting of the women’s allegations of sexual misconduct.
It succeeded in keeping secret the identities of leading employees accused of misconduct by the sisters.
During legal arguments, the sisters’ barrister James Laddie said they were concerned that they had been branded “Muslim gold-diggers”.
Mr Laddie said that the women were keen that their allegations of sexual harassment be fully reported despite Tradition’s bid to ban reporting of them.
He said: “It is obvious that the sexual element of their allegations is the centrepiece.”
The tribunal heard that the women had alleged that brokers took clients to Secrets lap-dancing club on London’s Gray’s Inn Road.
Paul Goulding QC, for Tradition, said that the sisters had threatened the firm before the tribunal that they would go public with their allegations of sexual misconduct.
He said that the woman warned that it would “come out before it goes to court that there are drugs and prostitution within Tradition and it will hurt them big time”.
Mr Goulding said that the women had been “opportunistic” in changing their mind about being willing to have their allegations of sexual misconduct fully reported.
He said: “We say that is really what lies behind this change of position on the claimants’ part is an opportunistic volte face with a calculation that if sexual misconduct allegations can be fully reported during this tribunal, it will cause maximum embarrassment to Tradition.”
The sisters had also planned to allege that bosses removed their Jewish clients and transferred them to non-Muslim colleagues.
One of the sisters alleged that a client working for a big bank was allocated to a Jewish colleague because the two “had in common both language and race”, according to submissions for the case.
“The removal of certain clients from the claimants... might have been because the claimants are Muslim and because they are women,” the document says.
Tradition’s parent company, Compagnie Financiere Tradition, is one of the world’s largest broker firms with a 2007 turnover of £770m.
Samira Fariad started work in the Paris branch of the firm in 2001.
Three years later she was transferred to London where she was joined by her sister.
The pair, who grew up in Casablanca, Morocco, worked as brokers in the London office for two years until November 2006 before resigning.
As brokers, they would have been on a basic salary of around £50,000 plus commission, which is likely to have taken their total pay into six figures.
A spokesman for the sisters said: “The parties are pleased to confirm that the matter has now been settled on confidential terms.”
Tradition refused to comment on the case citing the terms of the settlement. But it previously strenuously denied all allegations.
Earlier this month a statement read: “TSAF considers the central claim of religious discrimination allegedly exemplified by the transfer of Jewish trader clients away from Muslim to Jewish brokers to be an utter distortion of the facts.
“TSAF did consult with one of the claimants concerning a proposed reallocation of a number of clients – not only those that are Jewish – in order to encourage more productive broking.
“The claimant concerned made all decisions concerning allocation of clients herself, with full discretion and no coercion.”