Kerviel wins €400k over SocGen firing

French former Societe Generale rogue trader Jerome Kerviel leaves the Versailles appeal court after fighting civil damage, in Versaille, France, 20 January 2016. Kerviel, a former banker, ran up to 4.9 billion euros in losses at Societe Generale in 2008 and was sentenced to prison on 19 May 2014 for a three-year jail sentence. EPA/YOAN VALAT©EPA

Jerome Kerviel at an earlier appeal hearing

Jérôme Kerviel, the rogue trader who cost Société Générale €4.9bn, has won more than €400,000 in compensation from his former employer for unfair dismissal.

A Paris employment tribunal on Tuesday said that he was fired “without real and serious cause” in 2008 and was awarded €100,000 in compensation as well as his €300,000 bonus for 2007.

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The ruling is the latest blow for SocGen which, eight years after it was brought to the brink of collapse by Kerviel’s hidden trading, is still seen by many in France as the villain in the story even though its former employee was convicted by France’s highest court.

SocGen said it would “immediately” appeal against the ruling, which includes an order to pay Kerviel €80,000 as soon as possible. “It’s a scandalous decision,” said Arnaud Chaulet, SocGen’s lawyer.

In a statement, the bank said: “This decision is incomprehensible and inconsistent with the decision of the supreme court which has passed definitive sentence on Jérôme Kerviel. It is counter to the facts that have been judged. We will appeal against this decision.”

Kerviel never denied amassing €50bn in hidden trades before the financial crisis, which cost SocGen €4.9bn to unwind. But he has long argued that SocGen was fully aware of his rogue trading.

In court this week, his lawyer argued that this tacit approval — long denied by SocGen — meant his dismissal was unfair. The courts on Tuesday seemed to side with Kerviel.

Hugues Cambournac, the judge, said: “Société Générale can’t pretend it was not aware of Jérôme Kerviel’s fake operations.”

The €400,000 awarded, however, was a far cry from the €5.7bn that Kerviel had asked for. Kerviel wanted €800,000 in compensation on top of €4.9bn that the bank lost from his trading.

Kerviel was first found guilty in 2010 of abuse of trust, forgery and computer abuse. After years of appeals, France’s highest court in 2014 upheld the original decision, finding him solely responsible for SocGen’s losses.

The 39-year-old was initially ordered to repay the money lost by the bank, which he described as a “lifetime death sentence”, but this has since been cancelled.

The ruling on Tuesday, handed down by a tribunal made up of employer and trade union representatives, comes as Kerviel faces a separate civil case due to start next week.

The civil trial will look into the extent of SocGen’s responsibility for the €4.9bn loss, where Kerviel will once again argue that he was only partly to blame as SocGen knew what he was doing.

It has the potential to cause further embarrassment for the lender. SocGen has already admitted inadequate internal controls and was fined €4m in 2008.

Kerviel has also mounted a fresh challenge to his criminal conviction after Nathalie Le Roy, the police officer who led the Kerviel probes in 2008 and 2012, expressed concerns last year about pressure to convict him.

France’s court in March said they would indefinitely delay a decision on the bid for a retrial in the criminal case until other cases had been processed.

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