Finance minister discusses Societe Generale

http://afp.google.com/article/ALeqM5gX3M10vIC3dywgXeortNBmu4TDpQ

PARIS (AFP) — Internal control failures at Societe Generale contributed to the bank’s multi-billion-dollar rogue trade debacle, France’s finance minister said Monday, urging tougher penalties for banks that neglect proper checks.

“Certain internal control mechanisms at Societe Generale did not work and those that did were not always followed up with the appropriate changes,” Finance Minister Christine Lagarde said as she delivered a report on the scandal to the French government.

Already reeling from the biggest rogue trade losses in history, Societe Generale and its embattled chairman faced more trouble Monday as they went on trial over a French-Israeli money laundering scam dating from the 1990s.

Four banks including Societe Generale and 138 people including the bank’s chairman Daniel Bouton, are accused of turning a blind eye to a multi-million euro traffic of cheques, in a trial set to run in Paris until July.

Societe Generale announced staggering losses of 4.8 billion euros (7.1 billion dollars) on January 24, blamed on 31-year-old rogue trader Jerome Kerviel who has been charged in the case.

Check out this article about developments at Societe Generale as a result of the losses reported. The thing to remember is that the same kind of thing could happen to your business, that ensuring the right processes, technical and non-technical are in place to limit your liability/exposure.