updated 2/5/2008 12:37:51 PM ET 2008-02-05T17:37:51

Potential legal troubles for French bank Societe Generale have expanded to the United States and the futures trader allegedly at the root of the $7 billion scandal is now under police protection.

Societe Generale's New York branch was contacted on Jan. 25 by the U.S. Attorney's Office for the Eastern District of New York, bank spokeswoman Laura Schalk said. She said the bank was cooperating fully with the U.S. investigation into the trading losses, but would not elaborate on the focus of the probe.

Jerome Kerviel is under police guard because of "all the people who want to obtain his secrets," Finance Minister Christine Lagarde said on RTL radio Tuesday. "It is natural that he would be protected."

In his first public comment since the scandal shook the banking sector worldwide, Kerviel told French news agency Agence France Presse that he would not take all of the blame for the losses.

"I take my share of the responsibility but I will not be turned into a scapegoat of Societe Generale," he said in an interview from his attorney's office.

Societe Generale announced Jan. 24 that it lost $7.09 billion cleaning up unauthorized transactions by Kerviel. It was harsh news for the bank — one of France's biggest — and for a financial market already roiled by the subprime mortgage crisis.

Investigating judges have filed preliminary charges against Kerviel for breach of trust, forgery and unauthorized computer activity.

Two investigating judges questioned Kerviel for eight hours Monday, a judicial official said Tuesday. The official gave no details about the interrogation, and spoke on condition of anonymity because the investigation is ongoing.

Several investigations are under way to determine how bank controls failed to unearth suspicious trading and how and when Societe Generale disclosed its losses. The bank has also become a takeover target.

The U.S. Securities and Exchange Commission reportedly opened an investigation into stock sales by American investor Robert Day, a Societe Generale board member, in the days before the losses were made public. Schalk would not comment on the report, published in the Wall Street journal.

A spokesman for Day has said the trades were legal, that they were not made using insider information, and that Day is cooperating with authorities.

French market regulators were already investigating stock trades by Day. Day, an investment manager with U.S.-based Trust Company of the West, or TCW, and his family's trusts and foundations sold $206 million worth of shares in January, before the trading losses were announced.

Societe Generale also said Day had no inside information about the unauthorized activity by Kerviel and that Day sold the shares during a limited window when board members are authorized to sell stock.

The bank's shares have bobbed up and down since the announcement of the trading losses, and fell 5.3 percent on Tuesday.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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