SocGen shareholders not told about £127m fraud
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French bank Societe Generale did not tell its shareholders that it fell victim to a further £127m fraud.
The fraud occurred in December 2007, only weeks after the multi-billion pound fraud by Jerome Kerviel.
The alleged fraud happened at the Swiss branch of SocGen’s Russian subsidiary Rosbank. The loss is detailed in Rosbank’s 2007 annual report where it is described as a fraud, in the 2008 reports it says the situation was remedied by the injection of shareholder funds.
By the time the cash injection took place SocGen had a 50 per cent stake in the bank.
According to the Daily Telegraph, the loss at Rosbank was connected to problems at an Iranian steel trading group Safa Industrial. It says that despite numerous lawsuits, Rosbank failed to establish any wrongdoing or liability on the part of Safa or its owner Mohammad Rostami Safa.
SocGen declined to comment on the fraud.
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