As more details emerged about the largest banking fraud in French history, the country’s big guns were doing all they could to restore confidence in its financial system. The man accused of gambling away nearly 5-billion euros from Societe Generale’s coffers, Jerome Kerviel, has disappeared.
President Nicolas Sarkozy said the fraud has not affected the viability of the French financial system: “I don’t think you can link the internal problem at Societe Generale – which as far as I can see is a massive internal fraud – with what’s happened in the international financial system, sparked by the sub-prime credit crisis in America.”
France’s second largest bank says it is now looking at how a junior trader managed to lose so much of its money, betting on the stock markets, undetected by sophisticated security measures for more than a year.
Didier Cornadeau, who represents the bank’s small stockholders said: “We are going to make sure that the shareholders’ rights are guaranteed. We have filed a global lawsuit, and we ask for the protection of the law and a full investigation led by the French Financial Markets Authority, so that a mistake like this won;t happen again.”
The bank’s top brass have been eating humble-pie in full-page newspaper advertisements, apologising to shareholders for the drop in the bank’s market value.