French police interrogate a second trader about the fraudulent transactions that cost Socit Gnrale 4.9 billionin possibly the largest fraud case the banking world has ever seen.
Although futures trader Jrme Kerviel has been singled out for making risky trades with the bank’s money using fraudulent positions, he has claimed that he is being used as a scapegoat by Soc Gen. Now several news outlets report that another trader has been taken into custody and is being questioned about the trades that led to Soc Gen’s losses as well as his relationship with Kerviel.
Soc Gen itself claims Kerviel acted alone, but police apparently suspect that the second trader was aware of the transactions. It is reported that the trader works at a Soc Gen affiliate, Newedge, and was brought in after police searched company offices.
A message was allegedly sent to Kerviel on 30 November 2007 from the second trader reading: “You have done nothing illegal in terms ofthe law.” Preliminary charges of forgery, breach of trust and unauthorized computer activity have been filed against Kerviel while the police probe continues.