Employee shareholders at Societe Generale said yesterday they had started legal action following a multibillion-dollar rogue trader scandal at the French bank.
Employees and former employees, represented by the association ASSACT SG, form the bank's largest shareholder, holding around 10 percent of its capital and more than 10 percent of voting rights.
The association said it was "its duty to contribute to shedding light on the recent disappointment of which all Societe Generale shareholders are victim, notably employees and former employees."
"We are filing suit because we want to be kept informed of the affair's progress," said its head Patrice Leclerc, criticizing a "lack of transparency due to the fact Societe Generale staff are not represented on the board."
Leclerc stressed his association did not want to single out rogue trader Jerome Kerviel, who is being investigated over the losses of 4.8 billion euros (US$7.1 billion) announced by the bank last Thursday.
But he criticized the fact that around 50 people in the bank's investment division earned more than its chairman, Daniel Bouton.
"These excesses are no guarantee of good management and our members want reason to prevail," he said.
Already, three groups of Societe Generale minority shareholders have filed suit alleging insider trading and manipulation of share prices in relation to two major share sales this month by Societe Generale board member Robert Day.
The French financial regulator AMF said on Tuesday it had opened an investigation into share sales in the days before the rogue trade scandal emerged.
Bouton also faced increasing pressure from French officials to answer for the rogue trader disaster ahead a meeting yesterday of its board of directors.
As questions multiplied over Societe Generale's failure to prevent the disaster, Finance Minister Christine Lagarde stressed on Tuesday it was "up to board members" to decide on Bouton's future.
"Societe Generale is in crisis," she said, adding that "the board members are there to decide whether or not the person in charge is the best one to steer the ship or if a change of captain is needed."
The head of the French Senate finance committee, Jean Arthuis, went further: "I don't think Bouton has any choice but to leave."
Societe Generale's board turned down the 57-year-old Bouton's offer of resignation last week, after the colossal losses were announced, asking him to steer the bank through the crisis.
One of the best paid French executives, with a salary of 3.3 million euros in 2006, Bouton said he would forego six months' pay and reaffirmed on Monday that his offer to resign was still on the table.
But as the French government stepped in to warn market predators away from the crisis-hit bank, seen increasingly as a takeover target, the decision to keep Bouton in place came under scrutiny.
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