Societe Generale fires employees after financial scam

May 28th, 2008 - 7:57 pm ICT by admin  

Xinhua
Paris, May 28 (Xinhua) French bank Societe Generale, which has been in news since the discovery of a rogue trader scandal that wiped billions from the bank’s balance-sheet, has dismissed five of its employees, its chairman has said. “In total, there were two dismissals for disciplinary reasons, three dismissals for incompetence and two resignations,” said Daniel Bouton, who was responding to a question from a shareholder during the group’s annual general meeting Tuesday.

Societe Generale recently announced losses of 3.1 billion euros, directly attributable to the US real-estate meltdown. But another 4.9 billion euros that vanished from its accounts was blamed on trader Jerome Kerviel, awaiting trial in connection with allegations of unauthorised transactions.

In addition, the bank, France’s second largest, recently dismissed Kerviel’s immediate assistant for a simple misconduct offense, said a source within the bank confirming information which was first published by Le Figaro daily on its website.

In early April, the assistant in question had been placed under the status of material witness by French judges who are conducting a judicial inquiry to unravel circumstances behind the mega financial scam at the bank, according to reliable sources.

In an internal investigations report published May 23, the French bank announced the presence of “evidence of complicity” on the part of the assistant, but declined to give any names citing “ongoing government investigations”.

According to observers, to have given the concerned assistant the status of a material witness at this stage of the investigation means that the judges believe that “they do not have sufficient evidence demonstrating that the assistant had committed an offence”.

In one of his hearings, Kerviel was quoted as saying that he had as early as March or April 2007 “asked his assistant to enter fictitious transactions and that these instructions had been carried out on the knowledge that he was hiding open positions and gains”.

Questioned by the investigating judges over the allegations, the young assistant had challenged the assumption that he had knowingly entered the fictitious transactions to enable Jerome Kerviel to conceal his positions on the market.
Xinhua

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