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Group members:
• Imran Ullah Wazir
• M.Qasim
• Abd Ullah Jan
• Presentation topic :
• Jerom Kerviel :Rogue Trader
Founded in 1864
Core Businesses:
Corporate + Investment Banking
Global Investment Services
Over 130000 employees
From 114 ...
Conti….
customers:
19.2billion individual customers
in 76 countries.
The CEOs of the bank are
Philippe Cirtrrne
and
Daniel...
Who is Jerome Kerviel?
1. Name: Jerome Kerviel
Age : 31 years
Education: Masters of Finance, University of Lyon
Starting P...
• 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 bi...
HOW DID HE BYPASS CONTROLS:
• Learnt internal controls in starting position in
back-office.
• Exactly knew the internal ch...
Is Supervisor Know about him?
• Supervisors ignored over 75 trade errors.
• Reward his behavior with a proposed bones
of $...
Company Reaction
• After the fraud deduction of 7.14 billion.
• Socgen immediately report to the French central Bank.
• Ke...
Govt Reaction
• On Jan 26 kerviel was taken into police custody.
• The French president state that to the boards of
direct...
• Management | Organization | Technology
– Unauthorized Access
– Internal Control Breach
– Managers’ failure to identify k...
• Kerviel’s ethical misconduct
• Failure of internal controls
• Management and Supervisors
• IT Audit Controls
Jerom kerviel rogue trader
Jerom kerviel rogue trader
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Jerom kerviel rogue trader

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case study of Jerom Kerviel (socgen)

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Jerom kerviel rogue trader

  1. 1. Group members: • Imran Ullah Wazir • M.Qasim • Abd Ullah Jan • Presentation topic : • Jerom Kerviel :Rogue Trader
  2. 2. Founded in 1864 Core Businesses: Corporate + Investment Banking Global Investment Services Over 130000 employees From 114 different nations
  3. 3. Conti…. customers: 19.2billion individual customers in 76 countries. The CEOs of the bank are Philippe Cirtrrne and Daniel Bouton.
  4. 4. 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. Co-workers’ impressions: •Quiet And unassuming trader. •Unimpressive education background. • motive to impress his seniors.
  5. 5. • Job Goal: Create small, low-risk profit stream based on Large volume.
  6. 6. . What Kerviel Actually Did? • Bypassed all internal controls and made high risk unauthorized trades for a total of $87 billion in trades. • Purchased of 140,000 DAX(german stock index) • He exceeded the company overall market cap of 52.6 billion. • He bypassed controls by creating fictitious trades in “trading book” to offset his trades.
  7. 7. HOW DID HE BYPASS CONTROLS: • Learnt internal controls in starting position in back-office. • Exactly knew the internal checking schedule and removed all false transaction in books minutes before check. • Used other employees passwords. • Took minimum vacation days.
  8. 8. Is Supervisor Know about him? • Supervisors ignored over 75 trade errors. • Reward his behavior with a proposed bones of $440,000.
  9. 9. Company Reaction • After the fraud deduction of 7.14 billion. • Socgen immediately report to the French central Bank. • Kerviel Employment was terminated along with his supervisors. • 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.
  10. 10. Govt Reaction • On Jan 26 kerviel was taken into police custody. • The French president state that to the boards of directors to take action senior management including bouton. • On Jan 28 kerviel were charged with unauthorized computer activity and breach of trust.
  11. 11. • Management | Organization | Technology – Unauthorized Access – Internal Control Breach – Managers’ failure to identify key errors
  12. 12. • Kerviel’s ethical misconduct • Failure of internal controls • Management and Supervisors • IT Audit Controls

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