Kerviel Set for SocGen Appeal Case
Jérôme Kerviel will set foot in a Paris courtroom again on Monday, two years after the former trader was sentenced to three years behind bars and ordered to pay 4.9 billion euros ($6.09 billion) to former employer Société Générale.
The 35-year-old, who is appealing against the sentence, provoked a national scandal in 2008, after SocGen —France’s second-largest bank by market value—discovered he had placed 50 billion euros of uncovered bets on three futures markets, which cost the bank 4.9 billion euros.
He became a symbol of the excesses and malfunctioning of a financial system that he described as a “big banking orgy” which, in September 2008, saw the fall of Lehman Brothers.
Mr. Kerviel, who did not profit personally from the trades—other than perhaps seeking to augment his bonus—has been at liberty since his sentence in October 2010. The Paris appeals court hearing is scheduled to take four weeks.
David Koubbi, the lawyer hired recently by Mr. Kerviel, after he parted from Olivier Metzner, the star barrister who defended him in 2010, said on Friday that he had new evidence to present to court.
Mr. Kerviel admitted to faking documents to disguise his trades and to having got caught up in a “spiral”.
He claimed his superiors knew what he was doing, which the bank denied. He was judged to have acted alone and was found guilty of abuse of trust, forgery and computer abuse.
“The bank knew,” Mr. Koubbi said in an interview with Le Parisien daily on Friday. “The smokescreen created by the bank will disappear quickly once we open our windows.
“Société Générale is confident the appeal trial will uphold the sentence handed down by the lower court,” the bank said on Friday night.
“Since the beginning of the case, various investigative procedures—the police inquiry, 18 months of painstaking investigation and the trial in the Court of First Instance—have all unanimously confirmed the fraudulent actions committed by Jérôme Kerviel, without the Bank’s knowledge.”
Mr. Kerviel has sued SocGen twice in the past two months; once for forgery and manipulation of evidence, after allegedly discovering that a 12-hour tape of Mr. Kerviel’s questioning by senior SocGen staff had been cut by six hours.
He has also sued for allegedly obtaining a verdict under false pretences, claiming his former employer failed to inform the court that it had been granted a 1.7 billion euros tax rebate that reduced SocGen’s losses from the 4.9 billion euros he has been ordered to repay.
SocGen has countersued each lawsuit, alleging defamation.
Cases of bank risk-taking continue.