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In reply to the discussion: STOCK MARKET WATCH -- Wednesday, 31 October 2012 [View all]Demeter
(85,373 posts)8. The Bank Always Wins: Justice Is Done In France
http://www.zerohedge.com/contributed/2012-10-29/bank-always-wins-justice-done-france
On October 24, a French appeals court threw the book at former junior trader Jérôme Kerviel who, in 2008, had been hung out to dry by his employer, French mega-bank Société Générale, for havingso alleged the bankblown 4.9 billion of its money in just about no time. Hed risked up to 50 billion with trades the Banking Commission later called simple, far beyond his limit of 125 million. Kerviel never denied that. And hed done so without its knowledge, the bank alleged, using trick and device to conceal these gigantic trades for years. The crux of the case. And a lie, according to Kerviel.
The French mainstream media have been solidly on the side of the bank on which they depend for funding, and which they cant afford to antagonize. So they gloated when the court affirmed the 2010 conviction: a five-year prison sentencethree in the hoosegow and two suspendedand 4.9 billion in damages. But now, Kerviel and his lawyer, Me David Koubbi, showed up on France 2 TV and lambasted the proceedings that had been rigged, they claimed, from the outset. Even the loss of 4.9 billion is uncertain. No one knows anything, Koubbi said. Two successive courts accepted Société Générales number without even a cursory glance from an outside expert. An unprecedented dysfunction, he said. But as new evidence piled up after the first trial, it became clear, Koubbi asserted, that Société Générale had willfully aggravated the loss by adding the losses of other traders.
It was early 2008. The financial crisis was wreaking havoc. Banks around the world were forced to write off their elegant instruments, and they dug up skeletons, and markets crashedbut Société Générales only sin was a junior rogue trader. From 2005 through 2007, Kerviel made increasingly large trades, and as his profits rose, he became more confident. It was intoxicating, he said. At the end of every day, his direct supervisor came by and asked how much hed made and encouraged him. And the hierarchy set his ever growing objectives based on profits from the prior year. In 2007, he made 55 million for the bank, which became the basis for his 2008 objective. He was so successful that the hierarchy suggested in an email that the bank adopt the system Kerviel. In the trading room of about 100 traders, word of the magnitude and profits of his positions circulated. Société Générale traders in Asia called Kerviel the fat one (le gros) because of his positions. His boss in the trading room knew that he was risking up to 50 billion; emails between his supervisors and control services have emerged that discussed his outsized tradesone of them for 17 billion. But none of this was accepted by the court. Incomprehensible, Kerviel groaned.
On the plaintiffs side, it was the opposite. Its witnesses came and lied, Koubbi said; and when challenged, the judge said that plaintiffs witnesses had a right to lie. When Koubbi asked one of Kerviels supervisors what he knew about his trades, he replied: I cannot answer that question because if I answered that question, Id have to pay back the money I already received. Hed signed a contract with the bank that prevented him from talking about the case. And the judge let it go...
MORE FRENCH INTRIGUE AT LINK
On October 24, a French appeals court threw the book at former junior trader Jérôme Kerviel who, in 2008, had been hung out to dry by his employer, French mega-bank Société Générale, for havingso alleged the bankblown 4.9 billion of its money in just about no time. Hed risked up to 50 billion with trades the Banking Commission later called simple, far beyond his limit of 125 million. Kerviel never denied that. And hed done so without its knowledge, the bank alleged, using trick and device to conceal these gigantic trades for years. The crux of the case. And a lie, according to Kerviel.
The French mainstream media have been solidly on the side of the bank on which they depend for funding, and which they cant afford to antagonize. So they gloated when the court affirmed the 2010 conviction: a five-year prison sentencethree in the hoosegow and two suspendedand 4.9 billion in damages. But now, Kerviel and his lawyer, Me David Koubbi, showed up on France 2 TV and lambasted the proceedings that had been rigged, they claimed, from the outset. Even the loss of 4.9 billion is uncertain. No one knows anything, Koubbi said. Two successive courts accepted Société Générales number without even a cursory glance from an outside expert. An unprecedented dysfunction, he said. But as new evidence piled up after the first trial, it became clear, Koubbi asserted, that Société Générale had willfully aggravated the loss by adding the losses of other traders.
It was early 2008. The financial crisis was wreaking havoc. Banks around the world were forced to write off their elegant instruments, and they dug up skeletons, and markets crashedbut Société Générales only sin was a junior rogue trader. From 2005 through 2007, Kerviel made increasingly large trades, and as his profits rose, he became more confident. It was intoxicating, he said. At the end of every day, his direct supervisor came by and asked how much hed made and encouraged him. And the hierarchy set his ever growing objectives based on profits from the prior year. In 2007, he made 55 million for the bank, which became the basis for his 2008 objective. He was so successful that the hierarchy suggested in an email that the bank adopt the system Kerviel. In the trading room of about 100 traders, word of the magnitude and profits of his positions circulated. Société Générale traders in Asia called Kerviel the fat one (le gros) because of his positions. His boss in the trading room knew that he was risking up to 50 billion; emails between his supervisors and control services have emerged that discussed his outsized tradesone of them for 17 billion. But none of this was accepted by the court. Incomprehensible, Kerviel groaned.
On the plaintiffs side, it was the opposite. Its witnesses came and lied, Koubbi said; and when challenged, the judge said that plaintiffs witnesses had a right to lie. When Koubbi asked one of Kerviels supervisors what he knew about his trades, he replied: I cannot answer that question because if I answered that question, Id have to pay back the money I already received. Hed signed a contract with the bank that prevented him from talking about the case. And the judge let it go...
MORE FRENCH INTRIGUE AT LINK
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