Saturday, January 26, 2008

Solitary 'Mr Average'

Jérôme Kerviel's name is on every major world newspaper's front page. Along with this name, increasing murmurs are becoming louder roars, skeptics already started doubting the "lone man" theory perpetuated by the French bank giant Societe Generale's delayed explanation on "one of the largest financial scams in history."

Here are a few observations from The Washington Post:
Public doubts mounted over the bank's account that a single trader was responsible for $7.14 billion in losses, while top officials questioned why the bank waited nearly a week to announce the discovery of the massive fraud.

"It is difficult for everyone to understand how a single person, in a relatively short period of time, can cause losses as significant in a solid and reliable banking house," Prime Minister Francois Fillon said Friday at a news conference during a visit to Luxembourg.

Fillon said he has ordered his finance minister to investigate the fraud at France's second-largest bank, giving her eight days to submit her findings.

"The bank was completely irresponsible," said Frederik-Karel Canoy, an attorney representing more than 100 shareholders who have filed suit against the bank, accusing it of fraud and breach of trust. "We want to know what actually happened. It is impossible that he did it alone? . . . Of course it's easier to blame a young trader," he said in a telephone interview.
$7.14 billion dollar losses blamed on a single man of "average intelligence", does indeed raises eyebrows from many segment of world populace. Here is one excerpt from The Guardian's article:
"SocGen is blaming such big losses on a rogue trader in order to cover up something else. Are there wider problems at SocGen which require a scapegoat? The bank announced a €2bn (£1.48bn) writedown on Thursday from US sub-prime losses, but that is small compared with $18bn (£9.08bn) at Citigroup and $14bn at Merrill Lynch."
Putting blame on "lone gunman", or say a group of "miscreants", while the real crime perhaps committed by "above the average" intelligence, for who knows what, was used many a times in the past from antiquity to present days of turmoil, that many says artificially created.

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