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(Bloomberg) — Royal Bank of Canada said it has proof that its former chief financial officer engaged in an intimate relationship with a colleague that she failed to disclose, citing exchanges between the two over text messages and emails. 

Canada’s biggest lender filed a statement of defense and counterclaim on Friday in the wrongful dismissal lawsuit filed earlier this month by Nadine Ahn, the executive it fired in April after 25 years at the bank. 

The legal filing said Ahn began a close personal relationship with a colleague, Ken Mason — an executive in the bank’s corporate treasury group — as early as 2013 and that it continued until the time of her departure. 

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The document offers a remarkably detailed look at how the bank alleges the relationship played out over more than a decade. It includes descriptions of how the two bankers frequently met outside work for cocktails, celebrated anniversaries, swapped romantic poetry, and called each other by pet names — “Prickly Pear” for Ahn and “KD” for Mason.  

Their text messages “fantasized about a life together, such as reading in bed together,” RBC’s court filing states. 

“Ms. Ahn forwarded romantic poetry to Mr. Mason, expressing that she had fallen in love with Mr. Mason when she first saw him,” according to the filing. “Ms. Ahn and Mr. Mason continued to regularly see each other outside of the office during this time period, arranging a lunch on August 18, 2017 to celebrate their ‘fourth anniversary.’”

The close relationship continued after she was promoted to CFO in 2021, according to the documents. Royal Bank alleges that Ahn used her position within the company to orchestrate promotions and pay raises for Mason, an endeavor it says Mason referred to as “Project Ken” in a document he drew up. She also shared confidential information with Mason, the bank claims, such as a draft of a speech to be given by Chief Executive Officer Dave McKay.  

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The filing states that Royal Bank doesn’t have access to their messages, “except to the extent that Ms. Ahn and Mr. Mason copied personal communications to RBC systems.”

Lawyers for Mason and Ahn didn’t reply to messages seeking comment. Ahn said in her lawsuit that she and Mason were friends but denied that they were romantic partners. Mason, who filed a separate lawsuit against Royal Bank, also denied a romantic relationship and said the bank would have treated them differently if they had both been men. 

‘I Love You Too’

The bank cites “intimate communications” exchanged between the two via text message. As one example, it states, “On March 11, 2019, Ms. Ahn messaged Mr. Mason to say, ‘I love you.’ Mr. Mason responded 15 seconds later, ‘I love you too.’”

The two allegedly used calendar invites to schedule “liquidity meetings,” which the bank said was code for going for cocktails. At one such meeting, the two scribbled notes about their drink orders and other topics such as “concert, night out, winery” on a coaster from Canoe, an upscale restaurant in Toronto’s financial district. Mason had the coaster encased in plexiglass and kept it in his office, Royal Bank claims.  

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The bank said it began investigating in March after an anonymous whistleblower alleged that Ahn and Mason had been seen “hugging and kissing and exiting the elevators” at the Fairmont Royal York, a hotel that’s right beside RBC’s head office. 

Bank officials “immediately commenced a thorough investigation conducted by external legal counsel,” RBC spokesperson Gillian McArdle said in an emailed statement on Friday. “We were disappointed to learn the allegations were true.”

The Globe and Mail newspaper earlier reported on Royal Bank’s court filing.

Ahn’s lawsuit complained about the way Royal Bank handled the investigation, the speed with which she was fired after being confronted with the allegations on April 5, and the damage to her reputation when the bank put out a press release that same day. 

“Contrary to the statements of claim from Ms. Ahn and Mr. Mason, the investigation showed there was an undisclosed close personal relationship, and that Ms. Ahn misused her authority as CFO to directly benefit Mr. Mason,” McArdle said. “As she was a Named Executive Officer, we had an obligation to disclose.” 

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Ahn’s lawsuit is seeking almost C$50 million ($37 million) in pay and damages while Mason is suing Royal Bank for more than C$20 million in pay and damages. 

In its counterclaim against Ahn, Royal Bank is seeking about C$4.5 million for “excess compensation” paid to Mason and to claw back bonuses paid to Ahn, plus other damages and costs.

RBC’s filing states that when another employee raised concerns about Mason’s pay, Ahn terminated that person’s employment without cause. The bank said that former employee “has demanded compensation from RBC for bad faith termination of his employment, because of Ms. Ahn’s conduct.” 

(Updates with additional details beginning in the fourth paragraph.)

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