Scapegoat or Rogue – a 4.9bn Euro Question
A Paris court has sentenced former Société Générale trader Jérôme Kerviel to a three year jail stint and ordered him to repay the 4.9 billion euros he lost the bank in 2008 in the wake of vast North Atlantic finance industry scams that destroyed the Western economy.
Kerviel who was charged with “breach of trust, forgery and entering false data into computers”, has announced he will appeal to France’s highest court against his sentence. In court he claimed the bank had used his losses to mask the threat posed by the US subprime mortgage market collapse.
So is the 35-year-old “rogue trader” a crook or as his lawyer, David Koubbi insists, a “scapegoat”? The court clearly believed it was the former, sentenced him accordingly and his onetime employer — Société Générale — says justice has been done.
See below for an important update: Wolf Richter is reporting a significant and potentially explosive development.
There are others however who would certainly disagree. In the current gloom and adversity — worst since the Great Depression of the 1930s — where the Western world remains engulfed by financial havoc that has destroyed lives and wrecked the future of the next generation, the blame is surely system-wide. (See these remarks by the UK’s Bank of England governor Mervyn King on the ruination of the next generation.)
There is a vast bibliography on the Internet — a veritable crisis explainer industry — detailing the how and why of the 2008 disaster. Here is one article The Great American Bubble Machine referenced in earlier French News Online reporting, that offers justification for some of the more exuberant descriptions employed in our latest report:
Matt Taibbi at Rolling Stone magazine coined the ‘giant vampire squid’ description that is now widely-quoted shorthand for the ongoing financial crisis.
The no-holds-barred Paris-based TV commentator Max Kaiser (Keiser Report — RT Programs) attributes the global financial collapse to “Wall Street mafia … asphyxiating economies with cynical bank fiddles and institutionalized fraud… Wall Street Mafia takeover, Michael Hudson interviewed by Max Keiser Oct 5, 2012 … Today’s Keiser Show interviewed Dr Michael Hudson of New York on the Wall Street Mafia takeover.”
While in no way seeking to excuse white collar crime — indeed French News Online firmly supports calls to jail all bankers found criminally and/or civilly responsible for the 2007/8 crash — there are far too many “known unknowns” in the current financial disaster not to raise serious questions about the justice of just punishing pawns while allowing too many well-paid, bonus-chasing board members, directors, managers and supervisors in the corporate world to carry on regardless.
It is of course true that the bank was heavily sanctioned after the affair and as FRANCE 24 noted: “Société Générale, which has acknowledged management failures, was fined 4 million euros by the French Banking Commission in 2008 for failures in its risk control system. Two of Kerviel’s direct managers were sacked, and in 2009 Société Générale Chairman Daniel Bouton was forced to resign.”
However it is equally true that enough evidence has emerged in the five years that courts, prosecutors and journalists have spent unravelling and opining on the ‘great economic disaster’, that scammers, crooks and criminals driven by greed and lax oversight and aided by captured regulators and complicit politicians, were enjoying a financial feast at the expense, as it turns out, of taxpayers.
Now that the party has ended and taxpayers have been forced willy-nilly to shoulder bankster bills, there are growing numbers who ask why this should be and indeed why there should not be a global debt jubilee ?
- Read more about odious debt as a legal concept here: From Democracy to Debtocracy
….Now, Kerviel and his lawyer, Me David Koubbi, showed up on France 2 TV and lambasted the proceedings that had been rigged, they claimed, from the outset.
Even the loss of €4.9 billion is uncertain. “No one knows anything,” Koubbi said. Two successive courts accepted Société Générale’s number without even a cursory glance from an outside expert. An “unprecedented dysfunction,” he said. But as new evidence piled up after the first trial, it became clear, Koubbi asserted, that “Société Générale had willfully aggravated the loss by adding the losses of other traders.”
- Jerome Kerviel scapegoat cartoon (toonpool.com)
- Prison, $7 billion fine for rogue trader (bigpondnews.com)
- SocGen Staff Demand Kerviel Kompensation
- You Have 177,000 Years to Pay, Mr Kerviel
- Euro Discontent Marches on Brussels
- Storming the Bastille Version 2.011
- Global Noise says Don’t owe, Won’t pay
- Robber Barons Should Be in Jail
- A Euro-Lehman or an Orderly Unwinding?
- Its a Euroland War – the Banks vs the People
- The Biggest Financial Crisis in 75 Years
- “There is a tangible probability not a high probability that the worst may still be ahead…”