Ottawa: Royal Bank of Canada (RBC) says an employee it fired over an intimate relationship with its former chief financial officer (CFO) was focused on leveraging that alleged romance for his own personal advancement within the firm.

The bank filed a statement of defence and countersuit last Friday against Ken Mason, a former employee in RBC’s treasury department, who was dismissed in April at the same time as then-CFO Nadine Ahn.

Canada’s biggest lender alleges that Mason and Ahn carried out a close personal relationship for more than a decade.

That relationship crossed the line on a number of occasions, the bank said in its court documents - including when Ahn helped Mason get large raises that took his pay to almost C$1.2mil last year.

Mason and Ahn are each suing RBC for wrongful dismissal.

“To Mason’s knowledge, and at his urging, Ahn misused her power as CFO to bestow significant compensation increases and, ultimately, an executive-level promotion upon Mason, as part of a ‘Project Ken’ the two were pursuing together while in an undisclosed close personal relationship,” the bank said in its latest court filing.

A week ago, the bank made similar claims against Ahn.

Lawyers for Mason and Ahn did not immediately reply to requests for comment last Friday afternoon. In their lawsuits, they said they did not have a romantic relationship and were just friends.

Ahn said the bank subjected her to “palpable reputational harm” and “public humiliation” when it fired her. Mason has said the bank would not have handled the situation in the same fashion if the two were both men.

A representative for RBC declined to comment and referred back to its earlier statements on the cases. The bank has previously said it hired external legal counsel to conduct an investigation after receiving an anonymous complaint in March that Ahn and Mason had been seen together and were having a relationship.

The bank alleges that Mason’s total compensation for fiscal 2023 was C$1.18mil, up 70% from what he was making when Ahn was promoted to CFO in November 2021.

Last Friday’s filing includes many of the same allegations RBC has put forward in the Ahn lawsuit - including descriptions of how the two bankers regularly met outside of work for cocktails, called each other by pet names, swapped romantic poetry and sent text messages saying they loved each other.

When RBC confronted Mason with evidence of the undisclosed relationship on April 5, he denied they had an intimate relationship and said they were merely “work friends”, the bank said in court documents.

Mason went on to say he had been underpaid for his role and advocated for more money, often multiple times per year.

Mason claimed his promotion to vice-president was “merit-based” and that Ahn had not influenced it, the bank stated in the court filing. “This was not true: in fact, Mason’s promotion to vice-president was a centrepiece of ‘Project Ken,’ on which Mason and Ahn closely collaborated,” RBC said.

Ahn is seeking almost C$50mil in pay and damages, while Mason is suing the bank for more than C$20mil in pay and damages.

In its counterclaims against both Ahn and Mason, RBC is seeking to claw back what it calls “excess compensation” paid to Mason as a result of Ahn’s interventions on his behalf.

 - Bloomberg