The Wall Street Journal-20080201-In a French Twist- Infamous Trader Gets Hero Treatment- Bank Finds It Hard to Say Au Revoir to Mr- Kerviel- -Che Guevara of Finance-

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In a French Twist, Infamous Trader Gets Hero Treatment; Bank Finds It Hard to Say Au Revoir to Mr. Kerviel; 'Che Guevara of Finance'

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PARIS -- Societe Generale says wayward trader Jerome Kerviel lost the bank $7.2 billion. But that was last week. He's now on his way to cult celebrity -- and he still hasn't lost his job.

Societe Generale has stopped paying Mr. Kerviel and told him not to come to the office, but it hasn't managed to formally fire him. French law stipulates that to do that, the bank must first call him in for a sit-down meeting and explain its dissatisfaction. He has the right to bring along a trade-union official, a lawyer or anyone else he'd like.

That will be complicated: A pair of Paris judges this week released Mr. Kerviel from custody but forbade him to have contact with the bank. "This is a very peculiar case," says Emmanuel Dockes, a law professor at l'Universite Lyon 2, Mr. Kerviel's alma mater in central France.

Reviled by Societe Generale as a malevolent fraudster and "mutating virus," Mr. Kerviel, 31 years old, is now being hailed by a growing band of fans as "Robin Hood," "the Che Guevara of Finance" and even a genius worthy of the Nobel Prize in economics.

"Let's be honest: No one likes banks . . . and people like the rich to get cheated," says Christophe Rocancourt, a celebrated French con man who swindled wealthy Americans in the 1990s by masquerading as a french member of the Rockefeller family, a film producer and various other people.

Edward Yardeni, an American economist who runs an investment- strategy consulting firm, credits Mr. Kerviel with helping save the U.S. from recession. "Merci beaucoup, Jerome," says Mr. Yardeni, a former chief economist at Deutsche Bank. Societe Generale's unwinding of Mr. Kerviel's bad bets, he says, accelerated a market slide that prodded the Fed to slash interest rates.

Mr. Yardeni says French courts will have to decide whether Mr. Kerviel belongs in prison, but "we owe Jerome quite a few thanks," and he "certainly deserves a footnote in American economic history."

The French Communist Party, meanwhile, has compared Mr. Kerviel with Alfred Dreyfus, a Jewish French army officer whose persecution by the military hierarchy at the end of the 19th century has become a byword for gross injustice.

Societe Generale, which sees Mr. Kerviel in a rather different light, has said it definitely wants to fire him and is trying to find a legal way to do it.

Firing has never been easy in France, where on-the-spot dismissals a l'americaine are viewed as brutal and very un-French. "This is not like America or England. We have rules that protect employees, no matter what they do wrong," says Stephane Boudin, a Paris lawyer specializing in labor disputes.

Even Nicolas Sarkozy, who became president vowing to shake up France, hasn't proposed that bosses be allowed to can workers at will. Nor do French executives show much enthusiasm for rapid dismissals. None of Societe Generale's senior executives have yet been tossed overboard, despite their having been at the helm when the bank smashed into the rocks of the biggest trading loss ever.

France is one of the few places that haven't done a local version of Donald Trump's hit U.S. television series, "The Apprentice." The show's catch phrase -- "You're fired" -- has been translated into Russian, Chinese, Arabic, German, Norwegian, Turkish and several other languages, but not French.

Last week, when Societe Generale disclosed its trading debacle, getting rid of Mr. Kerviel seemed a forgone conclusion.

Daniel Bouton, the bank's chairman and CEO, issued an English- language statement, announcing that the "individual in question has been dismissed." But that turned out to be a translation error. The French original said that he had been "mis a pied," which translates literally as "put on foot," but basically means to be suspended or asked to go home.

"They can't just tell him to take his bags and get lost," says Michel Origier, a trade-union representative at the French bank where Mr. Kerviel worked -- and, technically at least, still works.

Societe Generale has "no intention whatsoever" of keeping Mr. Kerviel on its staff, said Francois Martineau, one of the bank's lawyers, earlier this week. But, he conceded, the bank can't formally fire him without following an elaborate process laid down by law. "We have to follow procedure," said Mr. Martineau, rolling his eyes.

Another member of the bank's legal team said yesterday that the bank had sent a formal letter to Mr. Kerviel calling him to a dismissal rendezvous. It scheduled the meeting for yesterday but the trader didn't show up, according to the lawyer.

The bank is intent on seeking at least some compensation for the damage Mr. Kerviel caused. It won't get back the 4.9 billion ($7.2 billion) in losses his trades allegedly triggered. But Societe Generale could establish a claim to any future earnings by Mr. Kerviel should he turn his adventures into a book or a movie.

Mr. Kerviel's own lawyer, Elisabeth Meyer, said earlier this week that she was still waiting for the bank to initiate dismissal proceedings.

"They've got 120,000 employees, and they can't find a single person to send a letter," she said.

Ms. Meyer said the bank had left Mr. Kerviel in a bind: He can't go to work, but because he's still technically an employee of Societe Generale, he can't sign up for unemployment benefits.

When the news of Mr. Kerviel's disastrously bad bets first broke, he seemed destined for infamy and shame. Even trade unions, usually quick to rally to the defense of employees targeted for dismissal, showed little sympathy or solidarity.

But the tide is now turning as questions mount about the bank management's own missteps and a change in Mr. Kerviel's public image from recklessly greedy master-of-the-universe to luckless little guy struggling to get ahead. Unlike Societe Generale's executives, mostly upper-crust graduates of elite colleges, Mr. Kerviel grew up in a small provincial town in a family of modest means. Lacking the academic credentials and connections of the bank's highfliers, he struggled to get his feet on the lowest rung of the trading ladder.

A Web site set up to chart the saga, jeromekerviel.com, has started polling visitors about whether the trader is to blame: According to one of the site's founders, 65% say no. Facebook, the social- networking site, now has dozens of pages devoted to various Jerome Kerviel support groups, including one that wants to "fight for Jerome Kerviel's reintegration in Societe Generale."

An American outfit is hawking "Jerome Kerviel Is a Hero" T-shirts, and a British oddsmaker Ladbrokes has opened betting on who will play Jerome Kerviel in a likely future film.

Mr. Kerviel's biggest fan base is at home in France, which often has a soft spot for cheeky rogues, particularly when their victims are well-to-do.

Mr. Rocancourt, the former Rockefeller impostor, has written three books about his exploits and says his own life story is being made into a movie. After doing jail time in the U.S. and Canada, he now lives in Paris with a former Miss France.

Mr. Rocancourt urges Mr. Kerviel to take full advantage of his current notoriety. "People always like a Robin Hood, a guy who steals from the rich."

But the veteran impostor -- who says he has mended his ways -- has some doubts about Mr. Kerviel's qualifications for a place in the pantheon of champion cheats. He says he can't fathom why, by all accounts, the Societe Generale trader didn't profit personally from two years of unauthorized, high-risk transactions.

"All that work for nothing? That sounds pretty dumb," says Mr. Rocancourt. "It doesn't take a genius to lose money. Anyone can do that."

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David Gauthier-Villars contributed to this article.