How ex-paratrooper grilling broke SocGen rogue trader - News - Evening Standard
       

How ex-paratrooper grilling broke SocGen rogue trader

Rogue trader Jerome Kerviel was in the fashionable resort of Deauville when he knew the game was up.

He had escaped the Paris hubbub for a weekend break to clear his thoughts and devise a way of getting out of a terrifying €1.5billion (£1.13billion) loss-making position on the financial markets.

According to reports Kerviel had been in big scrapes before at Société Générale and traded his way out of them - allegedly helped by falsifying a few records. But this time, his boss back in SocGen's glass edifice in Paris's La Defense financial quarter had spotted some odd-looking trades. His mobile rang with his boss's four-word summons back to the office: "We need some explanations."

That Saturday evening, he was grilled for seven-hours by Jean-Pierre Mustier, a former paratrooper and now head of SocGen's investment banking division. For hours, Kerviel revealed little, but gradually he started to break until finally admitting €50billion of the bank's money was at risk.

The grilling was so stressful that a doctor was called to monitor Kerviel's mental health. He was sent home for a few hours sleep before the questions continued.

A full picture was today emerging of Kerviel's downfall as SocGen chairman Daniel Bouton came under renewed pressure from a hugely critical government report into its middle-office control systems.

Bouton was also due in court in Paris for the start of a separate money-laundering trial. SocGen is one of four banks to appear over alleged money laundering between 1996 and 2001. SocGen denies the charges but they add to the sense of crisis at the French bank which is now a takeover target. Kerviel's deals lost the bank €4.9billion.

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