Evil Kerviel: Société Générale's rogue trader

Jackie Mason (who links his blog to ours through yours truly) once asked: What is the difference between a Jewish stuntman and an ordinary one? A normal stuntman, like Evel Knievel, is the guy who jumps his motorcycle over 20 buses while a Jewish stuntman is the guy who takes in $20-million and shows a loss.

Unless Jerome Kerviel turns out to be Jewish, the man now outed as the rogue trader who nearly occasioned the collapse of Société Générale, France’s second-largest bank seems to have missed the last bus and crashed his motorbike into our shul.

Uncle Jerome, who is also a children’s judo teacher, stands to go down in history as the greatest exponent of the sport after nearly throwing an entire bank.

What is not so funny is the way that a junior trader (even if he had a few accomplices — not established yet) could overcome the most sophisticated computer security systems, pose as a client and begin gambling — for that is what he was doing — with the future of an entire bank. The fraud and losses incurred thereby dwarfed what Nick Leeson did at Barings Bank, although the bank in this case will not collapse.

By slipping through the bank’s security system, he was able to use the bank to bet billions of euros on the rise of world markets.

The losses are believed to be in the order of $8-billion and wiped out the bank’s profits for 2007.

While this comes as another blow to the financial sector still reeling from the US subprime disaster, it did bring good news to some who are suggesting that it was the reason behind the US Federal Reserve’s rate cut on Tuesday.

Isn’t the scariest part of all this that no matter how big you are, how sophisticated your systems and how well-policed your personnel, some genius can slip through and bring it all crashing down?

While the culprit may be Nick(ed), banks don’t appear to have learned their Leeson (sorry, guys, couldn’t resist).

And to think that we thought a rogue trader was the guy who blew up an ATM!