Socgen trader loses bid for new inquiry

A PARIS employment tribunal this week rejected former Société Générale trader Jerome Kerviel’s plea for a new expert inquiry to overturn his dismissal in France’s biggest-ever trading scandal, which took place in 2008.

In a separate criminal case, Kerviel is running out of options to escape conviction and a jail sentence upheld by an appeals court in October over à4.9- billion (about R63-billion) in losses that French bank SocGen said were the result of unauthorised trades by Kerviel.

The 36-year-old former trader, who was ordered to repay the huge sum in its entirety, has never denied masking the à50- billion in market positions that went wrong as the financial crisis unfolded in early 2008.

He has, however, always said that his bosses knew what he was doing, an accusation SocGen denies.

Kerviel has asked the employment tribunal to overturn his dismissal and grant him à4.9- billion in damages, but no new inquiry will be opened.

Speaking to supporters and the media outside the courthouse after the hour-long hearing, an unshaven Kerviel said he was disappointed, but he would keep fighting ahead of a final ruling by the employment tribunal, which could take months.

“I am disappointed, of course . . . They’ve refused [my demands]. We will keep going,” he said.

Far-left groups and the popular press in France have painted Kerviel as a naive victim of big finance, despite his role before the case as a highly paid trader.

Dozens of supporters chanted slogans against SocGen and threw fake banknotes like confetti outside the court.

SocGen’s legal team issued a short statement saying Kerviel had been late in submitting several demands and that, after a “lengthy debate”, the employment tribunal had rejected them.

“Despite the media presence orchestrated by Jerome Kerviel, the legal system showed once again that it could remain clear-headed,” it said.

Without a new inquiry, it is unlikely that there will be any new elements brought to light that might help Kerviel’s case, either before the employment tribunal or in the criminal proceeding.

The former banker still had a chance of winning on some points, however, thanks to the technicalities of French employment law, said Mabrouk Sassi, a lawyer who specialises in tax, business and employment law.

Under the terms of his dismissal, SocGen said he had wilfully sought to hurt the company, which might be successfully rejected, Sassi said.

But even a victory for Kerviel in this case would only represent about à800 000, barely a dent in the à4.9- billion due. He may also still face time in jail.

“The paradox is that SocGen could lose on the dismissal but win the criminal case,” said Sassi.

Kerviel was flanked by his lawyer, David Koubbi, and far-left political firebrand Jean-Luc Melenchon, who compared the former trader to Alfred Dreyfus, a Jewish military officer and victim of anti-Semitism who was wrongfully charged with treason in the 19th century.

“This is a case of one individual against the financial world,” Melenchon told reporters. —