The French have detained one Jerome Kerviel for losing somewhere around 8 billion dollars (4B euros and change). I'm very skeptical that we've heard anything resembling truth.
How does a junior employee get the permission to take positions with 8 billion dollars of company money? The officials are claiming that he hid these positions. Look, have you ever tried to hide a few billion dollars? Have you ever tried to disguise the fact that you're holding several billion? You would tend to be the elephant in the room. And in fact, this is only the amount of loss. The actual portfolio must have been larger. Even if it were futures and derivatives, one needs assets to cover these things. All a long way of saying that some company official had to have signed some place.
But the real crime was committed this week when the company 'discovered' this hidden portfolio. They cashed it out, in a down market at great loss. If you recall from Trading 101, a loss isn't a loss until you lock it in. It was the company who locked it in.
Think I'll file this under 'Stories that Smell Really Bad'.