Former financial arbitrage trader Jerome Kerviel is the most indebted man on the planet, owing his former employer $6.3 billion.
The amount Kerviel owes to French bank Societe Generale for fraudulent trades made in 2007 and 2008 would make Kerviel one of the 50 richest people in America if those debts were assets.
The Atlantic's Matthew O'Brien writes that Kerviel managed €50 billion ($73 billion in unadjusted dollars) worth of unauthorized trades during his tenure at Societe Generale, using a sophisticated scheme of computer hacking and deceptive trades to deceive the bank.
O'Brien writes:
"In plain English, arbitrage just means taking advantage of discrepancies when things should have the same price, but don't. The idea is to buy the cheaper one, sell the more expensive one, and then wait for them to converge. The beauty is it doesn't matter whether markets go up or down--you're both long and short--just that the prices actually converge."
O'Brien spoke with former investment banker and current University of San Diego law professor Frank Partnoy about the logistics of trying to collect $6.3 billion from a single individual.
"Well, he's obviously not going to be able to pay the fine," Partnoy told the Atlantic. "What happened to Kerviel is the financial equivalent of sentencing someone to life plus 100 years. They'll likely reach some kind of agreement where a significant percentage of any money he makes for the rest of his life will be paid into a fund to cover the fine. He'll be like Sisyphus pushing the boulder up the hill every day for the rest of his life."
And while you could debate whether there are better ways for Kerviel to pay back Societe Generale, Partnoy offers a stark comparison to the fines levied against some of the world's largest financial institutions. In 2010, Goldman Sachs agreed to a $550 million settlement with Securities Exchange Commission, paid in part to investors and the U.S. government, which the SEC described as the largest settlement in history against any Wall Street firm.
Fannie Mae is the world's largest debtor, carrying $4.232 trillion in debt. U.S. companies make up 60.13% of the $10.8 trillion owed by the top 100 global companies in debt. Toyota holds the title of the world's most indebted company outside the financial industries, with a debt of $221.13 billion.
Jerome Kerviel, The Most Indebted Person In The World, Owes $6.3 Billion To Former Employer, Societe Generale. In a hyper-competitive world where everyone strives to be the biggest, boldest and most famous, no one covets Jerome Kerviel record-breaking achievement.
Former Société Générale rogue trader Jérôme Kerviel owes the bank $6.3 billion. Here's what his case tells us about financial reform. Enjoy a year of unlimited access to The Atlantic—including every story on our site and app, subscriber newsletters, and more. He can earn million-dollar gains without anybody knowing.
Nearly half of all US foreign-owned debt comes from five countries. All values are adjusted to 2023 dollars. As of January 2023, the five countries owning the most US debt are Japan ($1.1 trillion), China ($859 billion), the United Kingdom ($668 billion), Belgium ($331 billion), and Luxembourg ($318 billion).
The sudden rise in inflation has pushed global debt to new highs. In the second quarter of 2023, global debt was recorded as $307 trillion, largely driven by developed countries like the US, Japan, the UK and France.
Of the $33T of debt, roughly 78% is owned by the public (70% US vs 30% International). The major US public owners include the FED ($6T, but they are no longer buyers), mutual funds, banks, states, pension funds and insurance companies.
Former financial arbitrage trader Jerome Kerviel is the most indebted man on the planet, owing his former employer $6.3 billion. The amount Kerviel owes to French bank Societe Generale for fraudulent trades made in 2007 and 2008 would make Kerviel one of the 50 richest people in America if those debts were assets.
The largest holder of U.S. debt is the U.S government. Which agencies own the most Treasury notes, bills, and bonds? Social Security, by a long shot. The U.S. Treasury publishes this information in its monthly Treasury statement.
Pemex is among the world's most indebted oil companies, with financial liabilities exceeding $100 billion, but it enjoys strong support from leftist President Andres Manuel Lopez Obrador, who despite pursuing broad budget austerity policies has directed more funding to the state-owned oil and gas producer.
The most indebted companies were in the oil and gas, utilities, telecommunication and automotive industries. The world's most indebted company in 2021 was Toyota.
Introduction: My name is Pres. Lawanda Wiegand, I am a inquisitive, helpful, glamorous, cheerful, open, clever, innocent person who loves writing and wants to share my knowledge and understanding with you.
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