Societe Generale cites lack of management in fraud

PARIS (AP) — Investigators at Societe Generale said yesterday they suspect a former futures trader had help as he tried to cover up unauthorized positions that led to billions in losses at the French bank.

In two long-awaited reports, the investigators said the French bank's management failures and culture of risk-taking were partly to blame for failing to uncover the purported fraud, which led to a loss of more than $7 billion.

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Societe Generale Uncovers Massive Fraud

In what appears to be the largest trading fraud ever carried out by a single person, a young trader at French bank Societe Generale is accused of making unauthorized bets on stock markets that cost the bank nearly $7.2 billion but may not have netted him a cent.

The bank called the fraud "exceptional in its size and nature," and said it apparently went undetected for more than a year by its own multilayered security systems.

It would place the young trader, identified as 31-year-old Jerome Kerviel, atop the pantheon of rogue traders for a scheme from which bank executives said he apparently did not make a personal profit.

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