The French government has proposed tighter risk controls for the country's banks in the wake of the Societe Generale trading scandal.
French Economy Minister Christine Lagarde has presented a report into the Societe Generale trading debacle to Prime Minister Francois Fillon. It recommends tougher penalties, including much higher fines, for those breaking state banking commission regulations.
Lagarde said: "Clearly some of Societe Generale's internal control mechanisms did not work and those that did were not always followed up by appropriate changes."
As the Economy Minister produced her recommendations, French newspaper Le Monde reported that the positions taken by rogue trader Jerome Kerviel actually cost 6.3 billion euros to unwind, not the nearly five billion Societe Generale disclosed.
That was because the bank reportedly counted Kerviel's profits from last year - of 1.4 billion euros - against the total losses. Kerviel has told prosecutors his bosses had to have been aware of his trades because of the profits he had generated earlier.
There were more problems for Societe Generale as a trial started in Paris in which it and three other banks are accused of failing to crack down on a huge money-laundering scheme between France and Israel in the late 1990s.
http://www.euronews.net |
