Friday, January 25, 2008

As with most people working in the City, I was following the news of Societe Generale's fradulent trader, Jerome Kerviel, with avid interest. What amazed me were a number of things:

  1. FT's Alphaville was posting by-the-minute updates on the latest happenings, ranging from the revelation of the trader's name to uncovering of his photo to publication of his CV.
  2. The speculation that arose the next day about SG's becoming a potential takeover target. Financial journalists, bankers and punters alike - they're all vultures.
  3. The reference in respectable broadsheets such as the New York Times and the Wall Street Journal to Jerome's Facebook page, even tracking the number of friends he had, plummeting from eleven at the time the article was first published, to three when it was updated to one.
  4. The fact that that the trader had been doing this for a year, and still had not, in any way, profited from it. His annual salary and bonus came up to less than €100,000! For a trader, that's practically peanuts.
In fact, I think no. 4 startles me the most. What on earth was the motivation behind his fradulent behaviour (and I question this being put down purely as a case of fraud seeing as it also points to the broader issue of weak controls and risk management within SG itself) if it was not for profit?

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