SocGen was alerted to junior trader's positions last year
News of the alert threatens position of SocGen chairman Daniel Bouton and head of corporate and investment banking, Jean-Pierre Mustier - whose fates could be tomorrow
Société Générale may be criticised further over it’s security measures for
act after the alarm was raised last year by the trading regulator over Jérôme
Kerviel’s trading.
French investigators revealed yesterday that the Eurex derivatives exchange
raised the alarm after concerns at the positions the junior trader was taking as
early as November.
Yesterday German regulator Bafin – the agency that regulates trades on Eurex
– sent confirmation of the Eurex alert to French market regulators who are
currently investigating how controls at SocGen were breached.
It is not yet clear who Eurex alerted at SocGen, and the regulator has
declined further comment, except to say that ‘controls had functioned properly’.
A board member revealed that the fraud is to cost SocGen £3.9bn in losses.
The news could create further instability for the lender’s chairman Daniel
Bouton and head of corporate and investment banking, Jean-Pierre Mustier, whose
fates could likely be decided at a board meeting scheduled for Wednesday, the
FT reported.
Bouton has already accepted that he will leave, if asked.
Further reading:
Rogue trader Kerviel stays in custody
Investigation at SocGen ‘to take months’
Société Générale announces massive write-down – and
fraud