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A Société Générale trader who was fired for making unauthorized risky bets has hit out at the French bank, claiming that “the entire risk team and other bosses” were equally responsible and complaining that his bonus had been withheld.
Kavish Kataria wrote on LinkedIn that he was being made a “scapegoat” and that all his dealings were accurately recorded and visible to his superiors in Hong Kong and Paris.
“Instead of taking responsibility for the failure in their risk system and failing to identify the deals in a timely manner, they fired me and terminated my contract,” Kataria said.
Kataria worked on the Delta One desk, the same derivatives trading desk where fraudulent SocGen trader Jérôme Kerviel caused a €4.9 billion loss 16 years ago in a scandal that still haunts the bank.
SocGen confirmed earlier this week that two Hong Kong-based individuals had left the company last year – a trader and a team leader – following a “one-off trading incident in 2023 that had no impact and resulted in appropriate repair actions.”
According to a person familiar with the matter, Kataria did not exceed the permitted limits in his trades, but traded options on Indian indices, which he was not actually allowed to do. Since most of the cases were intraday trades, this was not immediately detected, the person added.
The trades did not cause losses but went undetected for some time and could have been loss-making in a hard and sudden market downturn, the person familiar with the matter said.
In a public post, Kataria said he did not hide his trades, which were automatically recorded in the bank’s systems, and generated an email to others at the lender showing that the trades had been reconciled.
“If the risk management team and its risk system had identified the trades on day one and informed me that the trades were not within their mandate, I would not have traded this strategy,” he wrote.
He claimed he earned $50 million for the bank in eight months and complained that “last year’s bonuses were also withheld and I only received seven days’ salary.”
“I would like to ask that in all this time there was no one to check what happened on the desk?” he wrote. “I admit that I traded options on Indian indices and in my opinion this was within my mandate and trading limits.”
“The trading industry is so big, but there are no rules or regulations that fight for justice for traders,” Kataria said.
SocGen declined to comment on Kataria’s statement.