PARIS (Reuters) - Former Societe Generale (SOGN.PA) trader Jerome Kerviel said on Wednesday he would make a final appeal to the French Supreme Court against a three-year jail sentence for his role in the nation’s biggest rogue-trading scandal.
Kerviel announced he would go to France’s highest court after losing his first attempt to overturn the sentence for taking huge, risky bets that cost the bank 4.9 billion euros ($6.35 billion) and hit its reputation.
Earlier in the day, the Paris appeals court upheld his 2010 conviction and demanded Kerviel repay SocGen the billions lost, potentially a life-time claim on part of his earnings.
“Without hesitation, I will call for a review of the ruling,” the 35-year-old told RTL radio. Kerviel said he was shocked by the appeals judge’s decision as he had hoped to be acquitted after a four-year legal battle.
The Supreme Court will rule only on whether procedures were properly followed in the previous rulings, rather than on the merits of the case. However, Kerviel cannot be put behind bars before it passes judgment.
Several outside observers said Kerviel’s appeal would delay the start of his sentence for one or two years but it was difficult to see how the conviction would be overturned.
“The Kerviel affair is pretty much over for the financial community ... The appeals court has confirmed the initial verdict and the chances of the Supreme Court cancelling it are slim,” said Hubert de Vauplane, a partner at Kramer Levin.
Kerviel has never denied masking the 50 billion euros in market positions that went wrong as the financial crisis unfolded in early 2008. However, he has always said his bosses knew what he was doing, an accusation SocGen denies.
The appeals court ruled on Wednesday that Kerviel was wholly responsible, upholding the first court’s verdict from 2010.
“Jerome Kerviel was the sole creator, inventor and user of a fraudulent system that caused these damages to Societe Generale,” the appeals court said in its ruling.
After the hearing, a nervous-looking Kerviel, who chewed his nails as he heard the verdict, was spared being sent immediately to prison. French law allows for a separate judge to negotiate exact terms of imprisonment.
In all, Kerviel’s sentence is for five years in jail, two of which are suspended.
SocGen has spent years trying to shake off the scandal, while other banks fight lawsuits over their behavior in the crisis era and the wider financial industry faces public perceptions that it is too risky.
The lack of a new “smoking gun” during Kerviel’s appeal that might have radically shaken up the case meant that outside observers saw his chances of walking free as slim.
But if the judge had put any responsibility onto SocGen for the losses, the bank might have had to repay 1.7 billion euros in tax write-offs on them. The bank has already said it would be reasonable in reclaiming the 4.9 billion euros, seen as a future claim on Kerviel’s earnings rather than a one-off fine.
Reporting by Lionel Laurent; Editing by Christian Plumb and David Stamp