Bloomberg sayeth:

The report censures the controls that Societe Generale, which helped create today’s derivatives markets, says keep risk at an acceptable level. It shows that compliance officers went through the motions of carrying out controls without challenging Kerviel’s explanations or probing further when he changed counterparties or canceled trades.

Ha. Sack them all.

Then someone should figure out why Jerome Kerviel was about to get a bonus.

Will Jerome Kerviel remain in custody?

A Paris court sent French trader Jerome Kerviel behind bars Friday, while the investigation into billions of euros (dollars) of losses he allegedly caused for bank Societe Generale took a new twist with a second employee taken into custody.

Investigators want to know whether Kerviel acted alone, and if so, how it was that a brokerage employee sent him a message before the scandal broke, saying: “You have done nothing illegal in terms of the law.”

This is getting repetitive…”no surprise.” Although it still won’t surprise me, I’m waiting to hear that volumes of trading records, emails, and other intra-office communications have mysteriously disappeared.

It may have been a “rogue trader” that caused a $7 billion loss for Société Générale, or maybe it wasn’t.

If someone, say six months from now, came out and said Société Générale lost that money on the up-and-up, that like every other bank on planet Earth they made big bets on mortgage securities and related derivatives, summarily lost their shirts, and then found someone to pin it on, I wouldn’t be a bit surprised.

Regardless, every single person even remotely associated with the compliance department at that financial institution should be sent packing immediately.

It just doesn’t pass my smell test.

UPDATE: Henry Blodget says the rogue trader/patsy/what-have-you still performed better than some Wall Street traders.

UPDATE 2: Of course Jermone Kerviel’s Facebook friends aren’t truly friends. All those “friends” wanted to do was get noticed themselves.

UPDATE 3: But, the Fed didn’t know about this before their historic rate cut. Either they’re out of touch, or…I’ve got a bridge I want to sell you.

UPDATE 4: Fodder for conspiracy theorists.