(Agencies)
Updated: 2008-02-21 13:45

An internal probe by Societe Generale has upheld the company's claims that trader Jerome Kerviel alone was responsible for amassing trading losses that exceeded US$7.2 billion, media reported.

A man, whom French media are identifying as Societe Generale employee Jerome Kerviel, is seen in this undated photo. [Agencies]

The interim report issued Wednesday by a special committee of the French bank said that there is no evidence at this stage of third-party collaboration with Kerviel, either internally or externally.

"At this stage of the investigations, there is no evidence of embezzlement or internal or external complicity (i.e. the existence of a third party who knowingly assisted the fraudster to conceal his positions)," the report said.

In terms of internal controls, the committee found that procedures were applied correctly, but that the absence of certain controls was a factor behind the unauthorized trading.

"Systematically, employees were not thorough enough in their checks," said the report, which is called "Mission Green" and was compiled by 40 bank experts and officials at PricewaterhouseCoopers.

For example, that officials in the back office often didn't inform their supervisors when they noticed irregularities in Kerviel's transactions -- even when the trades involved abnormally high amounts -- "because this was not specifically part of their job description."

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The report said Kerviel started building up non-authorized trading positions in 2005 and 2006 for "small amounts," but that they got bigger from March 2007 onwards. By the time SocGen discovered what was going on in late January, Kerviel had amassed a position worth US$72 billionThe report came a day before SocGen posted 2007 results. SocGen said last month it expected its 2007 net profit to fall 82 percent to US$1.39 billion, implying a US$4.93 billion loss for the fourth quarter alone.

The committee said it will continue its work in the coming months and provide a report at SocGen's AGM on May 27.