• Imran Ullah Wazir
• Abd Ullah Jan
• Presentation topic :
• Jerom Kerviel :Rogue Trader
Founded in 1864
Corporate + Investment Banking
Global Investment Services
Over 130000 employees
From 114 different nations
19.2billion individual customers
in 76 countries.
The CEOs of the bank are
Who is Jerome Kerviel?
1. Name: Jerome Kerviel
Age : 31 years
Education: Masters of Finance, University of Lyon
Starting Position: Risk Management Office
•Ending Position: Lower-level trader.
•Quiet And unassuming trader.
•Unimpressive education background.
• motive to impress his seniors.
• Job Goal: Create small, low-risk profit stream
based on Large volume.
. What Kerviel Actually Did?
• Bypassed all internal controls and made high risk
unauthorized trades for a total of $87 billion in
• Purchased of 140,000 DAX(german stock index)
• He exceeded the company overall market cap of
• He bypassed controls by creating fictitious trades in
“trading book” to offset his trades.
HOW DID HE BYPASS CONTROLS:
• Learnt internal controls in starting position in
• Exactly knew the internal checking schedule and
removed all false transaction in books minutes
• Used other employees passwords.
• Took minimum vacation days.
Is Supervisor Know about him?
• Supervisors ignored over 75 trade errors.
• Reward his behavior with a proposed bones
• After the fraud deduction of 7.14 billion.
• Socgen immediately report to the French central Bank.
• Kerviel Employment was terminated along with his
• Both the CEOs submitted a formal resignation .
• ON 25 JAN 2008 SOCGEN took out a full page newspaper
article apologizing to its customers for scandal.
.30 Jan board announced the formation of independent
committee to investigate the case.
• On Jan 26 kerviel was taken into police custody.
• The French president state that to the boards of
directors to take action senior management
• On Jan 28 kerviel were charged with unauthorized
computer activity and breach of trust.