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Leaked Recording Upends Case of 'Rogue Trader' Convicted of Losing Bank Billions

The timing of the leak is ideal for Jérôme Kerviel, who is trying to overturn his conviction for costing the French banking giant Société Générale nearly 5 billion euros in one of history's biggest trading scandals.
Photo by Christophe Petit Tesson/EPA

New evidence has surfaced in the case of Jérôme Kerviel, a French trader accused of having cost the French banking giant Société Générale nearly 5 billion euros ($5.3 billion) in one of history's biggest trading scandals, and convicted of fraud in 2010.

The massive loss resulted in 2008 from trades made by Kerviel that the bank described as "rogue" and unauthorized. Kerviel insists that his bosses were aware of his trades, and that they share responsibility.


French news outlets 20 Minutes and Médiapart have now leaked a secret recording of a lead prosecutor on the case that appears to discredit the bank's assertions that Kerviel was acting alone.

The timing of the leak is ideal for Kerviel, who appeared Monday before the Court of Revision in a bid to overturn his conviction. In France, you can only ask for a case to be reviewed if new evidence casts doubts on the guilt of a convict.

Leaving the hearing today, Kerviel told reporters who had gathered outside the court that he was "disgusted with the content of the recording," and that he was "ashamed for the justice system."

The court is scheduled to deliver its ruling by mid-March.

Secret recording
The controversial recording — described as "explosive" by the news site 20 Minutes — is an excerpt from a conversation between former police chief Nathalie Le Roy and Chantal de Leiris, a former deputy prosecutor on the case. Le Roy made the recording in a café in June 2015 without de Leiris's knowledge.

Le Roy, who was put in charge of the Kerviel case as a financial crime squad investigator in 2008, has since acknowledged that she lacked knowledge of the financial trading world when she took on the case. As a result of her technical ignorance, Le Roy has said that she felt "manipulated" by the banking giant and its witnesses in the case.

During their chat, de Leiris appears to confirm Le Roy's misgivings about the case, and about the role of the Société Générale.


"What you said when the case first came to light is true — you were completely manipulated by the Société Générale," de Leiris tells the officer.

After being removed from the Kerviel case in 2012, Le Roy continued to investigate the allegations independently, meeting deputy prosecutor de Leiris twice in 2015.

Among the more revealing claims made by de Leiris in the surreptitious recording is the allegation that "no expert assessment" was ever carried out to confirm the figure of 4.9 billion euros put forward by Société Générale.

The recording also implies that the prosecutor believes Kerviel's claim that the bank was aware of the scam.

"The SG knew, they knew," she is heard telling Le Roy. "It's obvious. Obvious!"

The prosecutor also suggests that the bank was trying to discredit Le Roy by making it public knowledge that the officer had suffered a stroke — a move she described as "vile."

Société Générale has called the leak a "manipulation by the media" that is based on "pseudo-revelations." Speaking to 20 Minutes, a spokesperson for the Paris prosecutor's office declined to comment on the conversation, but highlighted "the unfair method" used to procure the recording, which still needs to be authenticated.

An ongoing case
Société Générale filed a criminal complaint against Kerviel on January 2008, shortly after filing its annual report for 2007. The bank accused the 31-year-old trader of committing massive fraud that nearly brought Société Générale to its knees.


Kerviel was questioned on January 28, 2008 and detained for 48 days before being released pending the investigation.

Following an initial probe led by Le Roy, Kerviel was found guilty of breach of trust, forgery, and unauthorized computer use. He was sentenced to five years in jail (two of them suspended) and ordered to pay 4.9 billion euros in damages to his former employer.

Kerviel lost a first attempt to overturn the conviction in 2012, filing a second appeal with France's highest court that same year. The court rejected Kerviel's appeal in 2014, maintaining his prison sentence. The court did however drop the 4.9 billion euro fine, judging that the bank's internal control mechanisms were insufficient to prevent such scams.

At the time of the verdict, Kerviel was on his way to Rome to meet the pope, one year after the pontiff famously spoke out against society's "idolatry of money." Following his meeting with Pope Francis, Kerviel embarked on a lone march from Rome to Paris to denounce the "tyranny of the market."

RT— Michaël Szadkowski (@szadkowski_m)February 19, 2014

Kerviel was arrested on May 18, 2014, crossing the border between Italy and France. He was detained more than 100 days at the Fleury-Mérogis prison, on the outskirts of Paris, before having his sentenced reduced. He was freed on September 8, 2014 and permitted to serve out the rest of his sentence wearing an electronic monitoring bracelet at all times.


The former trader, who now works in IT, has kept a relatively low profile since his sentence relief, although his support committee on Facebook boasts nearly 12,000 members. To his many supporters who sell t-shirts emblazoned with his face, the disgraced trader has become a symbol of resistance against France's all-powerful banking sector. His allies say he was used as "a fuse" by his superiors, whose sole preoccupation was to protect the banking giant's interests.

His critics, on the other hand, describe Kerviel as an arrogant Gordon Gekko-type who broke the rules and went it alone. Société Générale has, from the start, denied Kerviel's allegations about the bank's involvement in the fraud.

A new civil trial is currently taking place before the Versailles Appeals Court Wednesday, to decide whether Kerviel will, in fact, have to pay damages. The court is expected to deliver its verdict Saturday.

Follow Pierre-Louis Caron on Twitter: @pierrelouis_c

Follow VICE News on Twitter: @vicenewsFR

Photo of La Défense financial district, in Paris, by Etienne Rouillon/VICE News.