France judges lay preliminary charges against rogue bank trader

[JURIST] Alleged French "rogue trader" Jerome Kerviel [BBC profile] was released on bail Monday after French judges filed preliminary charges of "breach of trust," "falsifying and using falsified documents," and "breaching IT access codes" against him relating to $73 billion worth of unauthorized trades he made while working for French bank Societe Generale [bank website]. The judges refused a request by prosecutors to include a charge of attempted fraud in their formal investigation. Kerviel, who has since been dismissed from Societe Generale, turned himself over voluntarily [JURIST report] to French police on Saturday. On Sunday, French authorities extended his detention for an additional 24 hours [JURIST report]. In addition to holding Kerviel, authorities seized evidence including computer disks and documents from his home and the offices of Societe Generale. AP has more, as well as a timeline of the events. AFP and Reuters have additional coverage.

The bank, which lost $7 billion when it was forced to unload the fraudulent positions, has filed a criminal complaint against Kerviel, and described the methods he supposedly used to commit the fraud in an explanatory note [PDF text] released Sunday. Kerviel has maintained his innocence and says that he is being made a scapegoat [Telegraph report] by the bank, which he alleges was aware of his activities. Additionally, BusinessWeek reports [text] that the Eurex derivatives exchange [exchange website] warned Societe General in November about Kerviel's unauthorized transactions.



 

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