- Pre-Market Indications

Wednesday, March 12, 2008

Police make new arrest in SocGen trading scandal

Police make new arrest in SocGen trading scandal

PARIS (Reuters) - Police arrested another employee of Societe Generale on Wednesday as part of its inquiry into an alleged rogue trading scandal at France's second-biggest listed bank, the Paris prosecutor's office said.

The prosecutor identified the person being held as a trader from a subsidiary of SocGen.

In January, SocGen unveiled 4.9 billion euros ($7.53 billion) of losses which the bank blamed on rogue deals carried out by Jerome Kerviel, a 31-year old junior trader at the bank. The losses have made SocGen a possible bid target.

Earlier, Europe 1 radio station reported that police had arrested an employee from SocGen's trading room as part of their investigation into the affair.

"A former colleague of Jerome Kerviel was arrested this morning," the radio station reported.

A spokeswoman for Societe Generale said that police had searched the bank's trading room on Wednesday and added that one person was being held for questioning.

Kerviel has been placed under investigation for breach of trust, computer abuse and falsification. He is currently being held in a Paris prison. The fresh arrest comes ahead of a hearing on Friday on whether he should remain in custody.

Europe 1 radio added that the person held was among one of Kerviel's friends listed on the Facebook Internet social networking site. The radio station did not give the full identity of the individual.

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