Nope this isn’t Nick Leeson, this is some other “in just a little too deep” trader named Jerome Kerveil. Mr Kerveil lost the company he trades for Societe General, which in French means “bank that is broke”, $4.9 billion Euros which is $7.18 Billion dollars. It was uncovered over the last few days as the markets sank. He, of course, was on the hoping the markets will rise team. The most amazing part of this whole scandal is that Kerveil didn’t stand to make a cent on these trades as he was salaried with no bonus for good trading. Here a little more on the story
PARIS (AP) — In what appears to be the largest trading fraud ever carried out by a single person, a young trader at French bank Societe Generale is accused of making unauthorized bets on stock markets that cost the bank nearly $7.2 billion but may not have netted him a cent.
The bank called the fraud “exceptional in its size and nature,” and said it apparently went undetected for more than a year by its own multilayered security systems.
It would place the young trader, identified as 31-year-old Jerome Kerviel, atop the pantheon of rogue traders for a scheme from which bank executives said he apparently did not make a personal profit.
Societe Generale Chief Executive Daniel Bouton said Kerviel’s motivations were “totally irrational” but gave no further clues to his motive.
The bank, France’s second-largest, said Thursday it had learned of the fraud last weekend. And the timing could not have been worse: The bank was forced to sell Kerviel’s contracts just as stock markets were plunging worldwide. It took the bank three days to unload them.
Societe Generale said the losses amounted to 4.9 billion euros, or about $7.18 billion — one of history’s biggest banking frauds. It led to immediate calls for tighter regulation.