PARIS —
The Paris appeals court on Wednesday ordered former Societe Generale trader Jerome Kerviel to spend three years in prison and pay back a staggering €4.9 billion (about $7 billion) in damages for one of the biggest trading frauds in history.
The 35-year-old Kerviel, who never profited personally from his unauthorized trades, says he was a scapegoat for the bank and a victim of a financial system that runs on greed and profits. His lawyer David Koubbi called the verdict "absolutely lamentable" and said his team will consider taking the case to France's highest court.
Because Kerviel cannot realistically pay the money back in his lifetime, the bank suggested it would refrain from seeking full repayment.
A lower court convicted Kerviel in October 2010 of forgery, breach of trust and unauthorized computer use for covering up bets worth nearly €50 billion — more than the market value of the entire bank — in 2007 and 2008.
By the time his trades were discovered in early 2008, when banks were sliding into a global crisis, had amassed losses of almost €5 billion on those bets.
The sentence — a five-year prison term, with two years suspended, plus the payback of all the losses he incurred — shocked many in the French public. After a global financial crisis that many blamed on big banks, many believed Kerviel's claim that he was a victim of an unjust system.
The appeals court Wednesday upheld the full conviction and sentence. It did not send Kerviel directly to prison, leaving him free pending his decision on whether to appeal to the Court of Cassation. He has five days to make that decision.
Kerviel arrived at the courthouse in a dark suit and looking tense and left through a back entrance without speaking to reporters. He had sought an acquittal, saying the bank had turned a blind eye to his exorbitant trades as long as they made money. Prosecutors and the bank say that isn't true.
Societe Generale lawyer Jean Veil said the verdict was "a great satisfaction."
He suggested the bank would take into account Kerviel's income and assets and not try to make him pay back the full fine. "Societe Generale will look at it with realism," Veil told reporters.
He indicated, however, that the bank could take over royalty earnings from a book Kerviel wrote about the scandal as well as any income he earns from movie deals. "It would have been indecent for Mr. Kerviel to be able to preserve revenues coming from the exploitation of his fraud."
While Societe Generale could have the right to tap Kerviel's future income, it was not clear whether they would do so and how much they could take from him.
Kerviel was fired from the bank in the wake of the scandal, and held a modest job for a while as a computer consultant. He was unemployed at the time of his appeals trial earlier this year.
A colleague from Societe Generale who testified on Kerviel's behalf said the court didn't take into account others at the bank who likely knew about Kerviel's risky bets.
A junior futures trader such as Kerviel "could in no case do what he did without being seen" by his superiors, Philippe Hoube said. "If justice had played its role, they wouldn't have sentenced him so heavily."
An internal report by the bank has said managers failed to follow up on 74 different alarms about Kerviel's activities.
A few of the bank's executives resigned in the scandal's aftermath, including longtime Chairman Daniel Bouton. Kerviel's superiors were questioned in the probe, but none of them faced charges.
The bank says Kerviel made bets on futures contracts on three European equity indices. It said at the time that his net position appeared unremarkable because he balanced his real trades with fictitious transactions.
Top Stories
Prison, $7 billion fine for French rogue trader
- Top Stories
-
-
Texas deputy killed in wreck, suspect detained
An off-duty Harris County sheriff's deputy has been killed in a traffic accident that's led to another driver charged with intoxication manslaughter.
-
Tornadoes slam Plains, Midwest; 1 dead in Okla.
When Lindsay Carter heard on the radio that a violent storm was approaching her rural Oklahoma neighborhood, she gathered her belongings and fled.
-
Activists say 28 Hezbollah members killed in Syria
Fierce street fighting in a Syrian town near the Lebanese border has killed at least 28 elite members of Lebanon's militant Hezbollah group, activists said Monday, as Syrian government forces pushed deeper into the strategic, opposition-held town.
-
Big 4 cellphone carriers unite on anti-texting ads
The country's four biggest cellphone companies are set to launch their first joint advertising campaign against texting while driving, uniting behind AT&T's "It Can Wait" slogan to blanket TV and radio this summer.
-
Details of Jolie's breast treatment revealed
Angelina Jolie's mother had breast cancer and died of ovarian cancer, and her maternal grandmother also had ovarian cancer — strong evidence of an inherited, genetic risk that led the actress to have both of her healthy breasts removed to try to avoid the same fate, her doctor said Wednesday.
-
Jolie admired for bravery in mastectomy revelation
"I hope that other women can benefit from my experience," Angelina Jolie wrote in a powerful op-ed article Tuesday, explaining her decision to go public with having her breasts removed to avoid cancer.
-
2013 deficit estimate lowered to $642 billion
The budget deficit for the current year is projected to come in well below what was estimated just a few months ago, a development that could further curb the already slowing momentum for a budget pact this year.
-
Bed Sharing Safely: Not All Co-Sleeping is Created Equal
Breastfeeding Significantly Reduces SIDS Risk
-
Security fence erected where Ohio women held
An imposing, 10-foot privacy fence has been erected around the home of a Cleveland rape and kidnapping suspect charged with holding three women captive for about a decade.
-
Police vow to solve shootings of 19 in New Orleans
Video released early Monday by New Orleans police shows a possible suspect in the Mother's Day gunfire that wounded 19 people during a neighborhood parade.
- More Top Stories Headlines
-
Texas deputy killed in wreck, suspect detained
