What is a Jew in Catholic’s Clothing? Still a Sarkozy

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Sarkozy is criticized for Holocaust memorial plan

By Elaine Sciolino, Friday, February 15, 2008, IHT

PARIS: President Nicolas Sarkozy dropped the intellectual bombshell at the end of a dinner speech to representatives of France’s Jewish community: Beginning next autumn, every French 10-year-old will have to learn the life story of one of the 11,000 French children killed by the Nazis in the Holocaust.

“Nothing is more moving, for a child, than the story of a child his own age, who has the same games, the same joys and the same hopes as he, but who, at the dawn of the 1940s, had the bad fortune to be defined as a Jew,” Sarkozy said in the speech Wednesday night. He added that every French child should be “entrusted with the memory of a French child-victim of the Holocaust.”

Sarkozy wrapped his plan in the cloak of religion, blaming the wars and violence of the last century on an “absence of God” and calling the Nazi belief in a hierarchy of races “radically incompatible with Judeo-Christian monotheism.”

Sarkozy

Education Minister Xavier Darcos explained later that the aim of the plan was to “create an identification between a child of today and one of the same age who was deported and gassed.”

The announcement, which comes as Sarkozy is already under fire for his frequent praise of God and religion, has touched off an even fiercer wave of protest.

Some psychiatrists and educators predict that requiring students to identify with a Holocaust victim will traumatize them and unfairly burden them with the guilt of their forefathers. Secularists accuse Sarkozy of subverting both France’s iron-clad separation of church and state and the republican ideal of a single, nonreligious identity for all.

Political opponents dismiss the plan as only his latest misguided idea unveiled without reflection or consultation. Some historians call the move a manipulation of the past that could distort France’s history of collaboration with the Nazis and lead to an escalation of personal remembrances of victims of other horrors of history.

“Every day the president throws out a new unhappy idea with no coherence,” said Pascal Bruckner, a philosopher. “But this last one is truly obscene, the very opposite of spirituality. Let’s judge it for what it is: a crazy proposal of the president, not the word of the Gospel.”

The initiative has also pitted Jew against Jew.

“It is unimaginable, unbearable, dramatic and, above all, unjust,” Simone Veil, honorary president of the Foundation for the Memory of the Holocaust and a Holocaust survivor, said on the Web site of the magazine L’Express. “You cannot inflict this on little 10-year-olds! You cannot ask a child to identify with a dead child. This history is much too heavy to carry.”

Veil was in the audience when Sarkozy spoke, and said that when she heard his words, “My blood turned to ice.”

But Serge Klarsfeld, the Jewish historian who has devoted his life to recording the names and biographies of France’s Holocaust victims, praised the president for his “courage.”

“This is the crowning glory of long and arduous work,” he said. “To those who say it’s too difficult for young children – that’s not true. What they see on television or in a horror film is much worse. This is not a morbid mission.”

On one level, the plan is a logical extension of Sarkozy’s sometimes sentimental and pedagogical approach to governing. Last year, he enraged politicians on the left, the biggest high school teachers’ union and some historians and teachers when he ordered all high schools in France to read a handwritten letter by a 17-year-old student who knew he was going to be executed by the Nazis for his resistance activities.

Sarkozy Jewish Award

On another level, it reflects his repeated declarations that as president he is also a “friend,” as he calls himself, of Israel. By extension, he is also a friend of France’s Jews. He is the first French president to address the annual dinner of France’s Jewish community.But there is something else. The plan comes as Sarkozy is trying to shatter another taboo in French intellectual life: religion. In a way, it reflects his deeply held, if iconoclastic, belief that religious values have an important place in everyday French society.

When Sarkozy was made an Honorary Canon of the Basilica of Saint John of Lateran in Rome last December, he proposed a “positive secularism” that “does not consider religions a danger, but an asset.” He was even more provocative in declaring that “the schoolteacher will never be able to replace the priest or the pastor” in teaching the difference between good and evil.

In Saudi Arabia last month, he infused his speech with more than a dozen references to God, who, he said, “liberates” man. He also declared last month that it was a mistake to delete the reference to “Europe’s Christian roots” from the European Constitution.”

In France, where religion is regarded as a private matter, Sarkozy vaunts his religious identity, referring publicly to his Jewish grandfather and wearing his Catholicity on his sleeve.

“I am of Catholic culture, Catholic tradition, Catholic belief, even if my religious practice is episodic,” he wrote in a book of essays in 2004. “I consider myself a member of the Catholic Church.”

But Sarkozy’s personal conduct seems to contradict his declaration of Catholic spirituality. Twice divorced, three times married (despite adherence to a religion that still abhors divorce), he has so alienated the country that an OpinionWay poll published Friday concluded that an overwhelming 82 percent of the French disapprove of his behavior.

That level of disapproval seems to have made Sarkozy vulnerable in whatever he does these days, including his Holocaust initiative.

Teachers defended the current approach to the Holocaust in French schools. Since 2002, 10-year-olds have studied the Nazi extermination of the Jews as a crime against humanity.

Older children watch films on the Holocaust, visit Holocaust museums and memorials and take field trips to concentration camps. Schools where students were taken away for deportation hang plaques in their memory.

“The Holocaust has to be put in the context of the rise of the Nazis and the war, not just emotion and dramatic spectacle,” said Gilles Moindrot, secretary general of the largest primary school teachers’ union. “If you do this with the memory of individual Jews, you’d have to do it with the victims of slavery or the wars of religion.”

Some of Sarkozy’s other political foes accuse him of trying to put his personal stamp everywhere.

“One day he is giving us sermons about God,” Jean-Luc Mélenchon, a Socialist senator, said on LCI television on Friday, adding, “Now he has suddenly turned himself into a teacher.”

Other analysts blamed the confessional approach of the United States for infecting Sarkozy’s thinking.

“Listen, it’s in the air of the times,” Regis Debray, a philosopher and author, said Friday on France Inter radio. “There is a religious sentimentality, a pretty vague religiousness, let’s say, in the world of show business, in the world of business, that comes from America. It’s the neoconservative wave of the born-agains.”

The anti-racism group MRAP accused Sarkozy of chauvinism by singling out French victims of the Holocaust for study and excluding other targeted groups like the gypsies.

holocaust child

Sarkozy’s advisers acknowledged that he came up with his Holocaust plan for schoolchildren without any formal consultation. In the face of all the criticism, however, Sarkozy vowed to proceed with it.

“It is ignorance – not knowledge – that leads to the repetition of abominable situations,” he said during a visit to Perigueux in central France on Friday, adding, “You do not traumatize children by giving them the gift of the memory of a country.”

Sarkozy Thumbs Up to Holocaust Education

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Jerome Kerviel, French Trader Had an Accomplice

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Collaboration at Société Générale? 2nd person taken into custody

By Nicola Clark, Katrin Bennhold and James Kanter

Friday, February 8, 2008

PARIS: A French investigation into Jérôme Kerviel, the former trader who Société Générale says cost it nearly €5 billion, or more than $7 billion, last month, took on wider dimensions Friday as French financial police interrogated a second person in relation to the case, calling into question the bank’s assertion Kerviel had acted alone in setting up billions of euros worth of fictitious trades.The news came as a Paris court bowed to prosecutors’ arguments that Kerviel should be taken into custody, partly to prevent him from having contact with significant witnesses in the case.Legal experts said that the revelation that Kerviel – who courtroom observers said appeared shocked by the decision to detain him – might not have been the lone operator the bank has made him out to be suggested that oversight of Société Générale’s trading room may have been recklessly lax. That may put added pressure on Daniel Bouton, the bank’s chief executive, and other top managers to explain more fully the circumstances that led up to the losses.”

It really suggests a higher-level failure of risk management than we thought two weeks ago” when the bank initially disclosed its trading losses, said Christopher Mesnooh, an international business lawyer based in Paris.”It’s one thing to overlook one person, but if it’s two people then it begins to stagger the imagination,” he said. “It looks as if there was probably a greater deal of collaboration than has so far been disclosed, as well as oversight failure.”

According to two people with knowledge of the investigation, Société Générale has provided prosecutors with new evidence related to Kerviel’s fictitious trades, including a series of electronic message exchanges between Kerviel, 31, and Moussa Bakir, a 32-year-old broker at Newedge, Société Générale’s futures brokerage unit formerly called Fimat, that were sent using the bank’s internal computer system.

According to these people, who requested anonymity because they were not allowed to discuss the case, one such message, sent by Bakir to Kerviel on Nov. 30, read: “You have done nothing illegal in terms of the law.”

Both added that this message was only a “small part” of the communications linking the two men and that there was more “interesting” correspondence that had yet to be disclosed.

The message was sent four days after Eurex, the Frankfurt-based derivatives exchange, had sent a query to Société Générale’s compliance department on Nov. 26 demanding clarification of several suspicious trades of stock index futures that Kerviel had made.

This was the second letter from Eurex in less than three weeks questioning Kerviel’s investment strategy and, in particular, asking about his habit of entering trades through a broker at Fimat, rather than from Société Générale directly.

In a letter Nov. 7 letter to Société Générale, Eurex even inquired whether Kerviel had entered the transactions automatically or manually.

“Please explain the background for this procedure,” two Eurex officials wrote.

Investigators are also examining Kerviel’s mobile phone bills, which Jean Veil, a lawyer for Société Générale, earlier this week described as unusually high, suggesting, he said, that there “could have been” others involved.

Veil emphasized the bank had found no evidence to suggest that Kerviel had accomplices.

“That said,” Veil said, “I am asking myself how he could have built up a €1,000 monthly cellphone bill given that he worked all day long in an office with telephones.”

A spokeswoman for the Paris prosecutor’s office, Isabelle Montagne, confirmed that the police had taken a male employee of Newedge into custody around midday on Thursday and that he was expected to be held for questioning until around midday on Saturday.

She added that the police had also raided Newedge’s offices on the Champs-Elysées in central Paris on Thursday, taking documents and computer files.

A spokeswoman for the Société Générale, Joelle Rosello, declined to comment, saying the bank was “cooperating closely with the investigation.”

Société Générale last month merged Fimat into Newedge, a joint-venture with the futures brokerage unit of Calyon, the investment banking arm of Crédit Agricole, another French bank. Spokespeople for Newedge referred all inquiries about the matter to Société Générale.

Stéphane Bonifassi, a business crime expert at the law firm Lebray & Associes in Paris, said the emergence of Bakir as a possible accomplice could have played favorably for the prosecution at the hearing Friday.

“The prosecution played it very subtly by having this other guy in the background,” Bonifassi said. “That there is this other guy may have strengthened the need to place Kerviel in pre-trial detention to avoid them talking together or coordinating their stories,” a risk often used to justify a request for pre-trial detention, he said.

Frédérik-Karel Canoy, a lawyer acting for small shareholders who was present as the ruling was read, said that when informed of the decision, Kerviel appeared as if “the sky had fallen on his head.”

“When he heard the words ‘placed in detention’ you could see his body crumple slightly as if it suddenly hit him that he really was going to prison,” Canoy said. Another lawyer who was present said that Kerviel was escorted away from the hearing room by three gendarmes but that he was not handcuffed. Kerviel’s lawyer, Elisabeth Meyer, wept, Canoy said.

Looking ashen-faced as she addressed a crush of cameras after the verdict, Meyer spoke in short, clipped sentences and vowed to appeal the decision.

“I cannot explain this decision,” Meyer said. “He’s met more than his match,” she said of Kerviel.

Ulrike Weiss, a spokeswoman for the Paris prosecution described the court’s decision as being “in line with our arguments.”

The Paris prosecutor, Jean-Claude Marin, last month requested that Kerviel be detained to protect him from media and professional pressure and because of concern about his mental health – and the possibility of suicide – before a trial.

Veil, the Société Générale lawyer, said the decision also reflected the concerns of prosecutors and the bank’s defense team that letting Kerviel go might risk interference with important witnesses or evidence in the case.

Kerviel, who was held by the police for two days of questioning last month was released under judicial supervision on Jan. 28. But that decision, by investigating judges in the case, was appealed by the prosecutor, Marin, which prompted Friday’s hearing.

Weiss, the prosecution spokeswoman, said that Kerviel could be detained for a period of between four and 12 months.

Kerviel was taken to La Santé prison, close to the center of Paris, where high-profile suspects like business leaders and politicians are often held while under investigation, according to Christophe Reille, his lawyer’s spokesman.

Kerviel is being investigated on allegations of forgery, breach of trust and illegal computer use, but he has not been formally charged with a crime.

In France, before formal charges can be brought, a judge must complete an investigation. If convicted, Kerviel could face a maximum sentence of three years in prison and a fine of €370,000.

jerome.kerviel.societe.general.banktrader

Bonifassi said that any chances of an appeal by Kerviel against an detention would be unlikely to succeed.

“I’d give an appeal extremely thin chances,” Bonifassi said.

He also said that the decision Friday represented a preliminary judgement on Kerviel’s guilt.

“Although judges will not admit it because pre-trial detention should not be based on feelings about someone’s guilt, the decision does show a feeling among the judges that he is guilty of something,” Bonifassi said.

Jerome Kerviel Testimony Transcript – French Police

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Transcript: Interrogation of Jérôme Kerviel

Wednesday, January 30, 2008

French financial police have questioned Jérôme Kerviel, the trader whom Société Générale says lost billions in unauthorized trading bets using its money, at length about his role in the alleged fraud. Following are translations, by the International Herald Tribune, of verbatim excerpts published in Thursday editions of Le Monde, a leading French daily, from the verbal interrogation, which took place in six interviews from Saturday through Monday.His position within the bank JÉRÔME KERVIEL: I was hired by Société Générale in August 2000, in charge of the middle-office…. During the second half of 2004, I was assigned to be assistant to a desk…. Since I was on the same row of desks as the traders, I became more and more interested in the trading activity…. At the beginning of 2005, I was transferred to trading on the desk….

When I was hired by Société Générale [in August 2000], my gross salary was about 35,000 a year plus variable bonuses…. For the year 2007, I haven’t yet been told of the amount of my gross variable yearly revenue,… I was asking for 600,000, they offered me 300,000. To this day, I have not received anything for 2007.

….I understood during my first interview in 2005 that I was far less considered than others because of my degree course and my professional and personal paths…. But I don’t take it personally, I assure you….

Admitting to fake trades. I do not formally question the facts that I am being blamed for. I admit having created fictitious operations, I admit the cancellation of fictitious operations; concerning the unauthorized stand I took on the futures, I am a little less affirmative. My mandate was clear: it consists in ensuring that the market-making of products…. presented no volatility: certificates, warrants, trackers…. It was about earning money for the bank only, and in no way to enrich myself. What is more debatable, I admit, are the ways used to achieve this.

When the coverup began. My first experience in this field goes back to 2005, I took a stand on Allianz stock, making the bet that the market would drop. It just so happens that shortly after the market drops following the London attacks, and there it was, a 500,000 jackpot. This time corresponds more or less to when I started as a trader at Société Générale. I then already have the idea of a deal to cover my position. I have mixed feelings about this because I am proud of the result and altogether surprised. It generates the desire to continue, there is a snowball effect.

….At the end of July [2007], the market snaps because of subprimes and the markets are shook up. My result goes up: 500 million, and I find myself in the same situation as before, in an even bigger way, and do not declare this result which doesn’t appear in the books of Société Générale. I hide this with a fictitious operation….

As of the 31st of December [2007], I no longer have a “pose” and my “mattress” [profits set aside] has gone up to 1.4 billion, still not declared to the bank. At this point, the situation is beyond me and I don’t know how to tell the bank about it, this represents unreported cash of 1.4 billion. So I decided not to declare this to the bank and to cover up this amount, I create an offsetting fictitious operation….

How he played the markets. At the beginning of 2008, I change my position to “long” [the status of a buyer] because I know that the market has evolved a lot, and I see the market coming back up in the next three months, and I am still to this day convinced that it’s going to bounce back up in the next three months…. [It] was only at the closing of the session of the 18th [January 2008] that I was negative. I then think that I will see the evolution of the market when I come back on Monday and count on the market rising on Tuesday. What I couldn’t assume is that Monday I would no longer be an employee of Société Générale.

….In November 2007, on intra-day successive operations, I went back and forth on the DAX [the German stock market index] and seeing it was juicy, took positions from coworkers’ automated machines at the same time and this everyone saw and knew. On that day alone, I made 600,000. My manager then wanted to know the reasons for my investment choices….

How he covered his tracks. Now for the bank, since I am not supposed to have earned this money, I reported a result of only 55 million…. I then provided fake evidence of the recording of these operations, i.e. fake e-mails. I created a fake e-mail with a function that allows me to reuse the heading of an e-mail that is sent to me and change the contents….

The techniques that I used are not sophisticated at all, in my opinion, any correctly executed inspection is able to detect these operations….

Red flags raised. I remain persuaded that they [his supervisors] were aware of these positions and by saying this I inform you of the existence of warnings that got to my hierarchy. In 2007, several questioning e-mails…. were sent to several of my coworkers in order to get explanations…. Another warning could have consisted in calculating the ratio between the ?55 million result that I reported in 2007 and the number of operations I processed. Two requests for information in November 2007, coming from Eurex in Germany, are sent to question the volume of operations I processed…. Following this investigation I am questioned…. and am able to justify myself. At the beginning of January 2008, I max out my credit limit…. I then receive questioning e-mails…. To justify myself, I then create a forged e-mail.

….The fact alone that I didn’t take any days off in 2007 [4 days] should have alerted my supervisors. It’s one of the elementary rules of internal control. A trader who doesn’t take any days off is a trader who doesn’t want to leave his book to another….

I was generating cash, so the signals weren’t that alarming. As long as we earn and it doesn’t show too much, as long as it’s convenient, no one says anything….

INVESTIGATOR: Did anyone comment on the 50 billion that you took during the first fifteen days of January?

A: I had a feeling the market was going to bounce back up.

Q: Caught in the gearing, how did you imagine you would be able to announce this without risking losing your salary?

A: I thought the simple fact of announcing a 1.4 billion profit would satisfy them.

Q:Without imagining the way they were covered up would result in a penalty/sanction?

A: How do you justify a penalty given to a trader who generates a positive result of 1.4 billion?

Q: Let’s suppose that your positions on the futures had been detected by Société Générale,… what would have been your defense?

A: My justifications would have been the same. The hope of the market turning over. However, I’ll say it again, from March to July my supervisors received a number of warnings that makes me think that the size of my stands was known.

Q: Why didn’t the checking services try to stop you?

A: It was in their interest to let me make money….

In the event that anything was detected during this period the whole team would have been fired. Including my higher-ups, one after the other. And that is what’s happening today. In both cases, it was in Société Générale interest to close its eyes. Whether I’m winning or losing….

No matter what, I was risking in one case just as in the other case losing my salary if my commitments were detected. It certainly was in my interest to hide my commitments to my supervisors.

International Herald Tribune

International Herald Tribune