A Paris court put French trader Jerome Kerviel behind bars, while the investigation into billions of dollars of losses he allegedly caused for bank Societe Generale took a new twist as a second employee was brought into custody.
Investigators want to know whether Kerviel acted alone, and if so, how it was that a brokerage employee sent him a message before the scandal broke, saying: "You have done nothing illegal in terms of the law."
The bank, prosecutors and France's finance minister have said that Kerviel appeared to have acted without help when he made massive unauthorized bets on European futures markets that the bank said cost it around US$7 billion to unwind.
The 31-year-old futures trader was sent to La Sante jail outside Paris on Friday, said a judicial official who declined to be named.
The court was concerned that, if left free, Kerviel could have jeopardized what promises to be a long and complex investigation -- by contacting possible accomplices or exerting pressure on witnesses, the official said. The prosecutor's office had urged the court to jail him.
Societe Generale has faced uncertainty over its future since the scandal broke on Jan. 24, as well as questions about how Kerviel's massive trades possibly went unnoticed. The bank has repeatedly said that he did not appear to have accomplices.
But the bank's lawyer, Jean Veil, raised the possibility on Friday that Kerviel only claimed to have acted alone to avoid jail.
Kerviel's lawyer, Elisabeth Meyer, said she planned to appeal, and compared her client's defense against the powerful bank to "David fighting Goliath." Judges had allowed Kerviel to go free last month after Meyer argued he did not pose a flight risk.
The revelation that a second employee was taken into custody on Thursday is a potentially big twist and could add a new layer of complexity to the case if it turns out he was an accomplice.
The employee worked at Newedge, a joint venture between Societe Generale and Calyon bank, another judicial official said.
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