Societe Generale wrote off €1.7bn in tax over rogue trading losses

12 October 2010

Societe Generale has used Jerome Kerviel’s €4.9bn trading loss to reduce its tax bill by €1.7 billion, news reports have claimed.

Nicolas Dupont-Aignan, a French politician, criticised the bank saying that “taxpayers shouldn't be made to pay for financial speculation”.

However, the French bank has claimed it acted appropriately and did not break any fiscal regulations.

Last week a French court found Jerome Kerviel guilty of unauthorised computer use, fraud and breach of trust and ordered the ex-trader to pay back €4.9 billlion which the bank lost through his actions.

The trader was also given a life ban from working within the financial services industry and a three-year prison sentence.

Following the verdict, Mr Kerviel said in an interview with Europe1 radio that he felt “crushed” by the ruling and compared it with being “hit on the head with a club”.

On his current salary, of €2,000 per month as an technology analyst, it would take the former trader approximately 177,000 years to repay the losses.

Olivier Metzner, lawyer for Mr Kerviel, has criticised the court’s verdict and announced that an appeal to overturn the decision will be launched.

Societe Generale has now said it does not expect the former banker to pay back the entire sum.

By Jim Ottewill

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