PARIS Jerome Kerviel, the man behind France's biggest rogue-trading scandal, finds out this week whether he is heading to prison or walking free after his last court appeal in a four-year battle against former employer Societe Generale (SOGN.PA).
Former trader Kerviel submitted a final attempt in June to be acquitted and avoid a three-year jail sentence handed down in 2010 for his role in taking huge, risky bets that cost SocGen 4.9 billion euros ($6.4 billion) to unwind and slammed the French bank's reputation.
Wednesday's verdict, barring unexpected legal challenges, will be the final say on a case during which Kerviel, who has kept an impassive front throughout, built a cult following.
While Kerviel has never denied masking the 50 billion euro positions that made headlines around the world as the financial crisis unfolded in early 2008, he has always said his bosses knew what he was doing - which SocGen denies.
The outcome will be closely watched by a financial industry facing other lawsuits over crisis-era behavior. A similar trial is unfolding in London over the role of trader Kweku Adoboli in a $2.3 billion loss at UBS UBSN.VX.
"These appear to be spectacular cases by virtue of the size of the risks taken by these traders and the danger that they put their banks in," said Emmanuel Moyne, a litigation lawyer at Linklaters in Paris.
"But if you compare it to cases where the amounts involved were much smaller, it is no different to people who simply cheated an internal controls system."
NO "SMOKING GUN"
SocGen, which refutes any responsibility for the trades, hopes it will once again be cleared in a saga that has dogged employees and Chief Executive Frederic Oudea since he took over from Daniel Bouton in 2009.
A ruling of responsibility or liability on SocGen's part would probably mean the bank having to repay 1.7 billion euros in tax write-offs relating to the losses. It would also likely get Kerviel off the hook regarding the full, court-ordered repayment of the 4.9 billion euros lost.
Former CEO Bouton testified both this year and in 2010, calling Kerviel a "great deceiver" and saying that the bank's risk managers and back-office staff never stood a chance against the trader's manipulations.
Meanwhile, Kerviel and lawyer David Koubbi have stuck to Kerviel's strategy - which lost him the case in 2010 - of insisting that all blame should be lain at SocGen's door.
With the appeal having uncovered no "smoking gun" against SocGen, it is unlikely that the 35-year-old former trader will win acquittal, lawyers say. The prosecution has called for Kerviel to serve five years in jail.
"The appeals process did not really change the presentation of the facts...I don't see the judge completely overturning the first conviction," said Hubert de Vauplane, a partner at Kramer Levin.
If Kerviel is put behind bars, the verdict will send a strong signal to the financial community - albeit four years after the bets themselves were uncovered.
Rather than prompting banks to tighten their risk controls systems, Kerviel's jail time is more likely act simply as a deterrent to employees and management in the financial sector.
"The heavier the sentences, the more likely it is that traders will take them into account," said de Vauplane. "A final prison sentence would set an example."
(Reporting by Lionel Laurent; Editing by Sophie Walker)