Prosecutor seeks appropriate charges against trader

By JAMEY KEATEN, Associated Press Writer

A Paris prosecutor on Monday asked for preliminary charges of forgery, breach of trust and fraud against a low-level trader accused by Societe Generale bank of orchestrating the largest securities fraud ever by single person.

Prosecutor Jean-Claude Marin said Jerome Kerviel, 31, did not attempt to steal money from the bank or its customers, but was motivated by a desire to be "an exceptional trader" and that he sought performance bonuses.

Kerviel appears to have acted alone, Marin said.

"It's always a bit for money, I'm not sure that was his prime motive," said the prosecutor. "It functions a bit like a drug, it's an addiction ... there's a sort of spiral you can't get out of."

Kerviel told investigators, who just wrapped up 48 hours of questioning, that he expected a bonus of 300,000 euros ($441,150) for 2007.

Societe Generale said it lost 4.82 billion euros ($7.09 billion) after unwinding Kerviel's trades.

Kerviel was set to appear before a judge who will decide whether to proceed with preliminary charges.

Under French law, filing preliminary charges means the judge has determined there is strong evidence to suggest involvement in a crime and gives investigators time to ask for a trial.

The bank's offices were searched Friday and "masses of documents" including computer records were seized, Marin said.

CEO Daniel Bouton said Societe Generale, thought by some experts to be vulnerable to a takeover, has not been approached.

Bank shares fell nearly 4 percent to 70.94 euros ($104.32) Monday.

Meanwhile, questions about how the bank handled the fraud are mounting. A lawyer for a group of Societe Generale shareholders, Frederik Canoy, said a legal complaint had been filed Monday asking investigators to look into possible insider trading.

The complaint was filed after France's market watchdog said in a routine disclosure that a member of Societe Generale's board, Robert A. Day, sold 85.75 million euros ($126.1 million) worth of shares in the bank on Jan. 9 — two weeks before the fraud announcement and well before bank management says it knew about the problem. Day is an investment manager with U.S.-based Trust Company of the West, or TCW, who Forbes magazine says has a net worth is $1.6 billion.

Two foundations linked to Day, the Robert A. Day Foundation and the Kelly Day Foundation, also sold a total of 9.59 million euros ($14.1 million) worth of shares a day later, on Jan. 10, the market watchdog reported. Regulators have made no allegations of wrongdoing.

Telephone calls to both Day foundations and TCW were not immediately returned Monday.

Bouton rejected suggestions from Kerviel's lawyers that Societe Generale was using their client to hide big losses linked to the U.S. subprime mortgage crisis.

"How could you want to imagine that we would have been able to hide a hole by another hole? It's completely stupid," Bouton told Europe-1 radio. He called Kerviel a "remarkable concealer" who had managed to outwit the bank's risk control systems by toggling between real and fictitious positions.

"That's what created this gigantic fraud," he said.

Elisabeth Meyer, one of Kerviel's defense lawyers, said he was "bearing up to the shock."

She disputed Societe Generale claims that Kerviel had committed fraud, saying he was in the black with his trades as of Dec. 31.

"In my view, he was thrown to the lions before being able to explain himself," said Meyer. "It's a lynching."

Another lawyer, Christian Charriere-Bournazel, said on Europe-1 radio that Kerviel made a profit of 1.5 billion euros ($2.2 billion) before his bets went sour.

The prosecutor, however, said the trader only "virtually" made a profit for the bank.

Kerviel could face a maximum seven years imprisonment if convicted under the current charges, the prosecutor said.

A day after the bank sent out a five-page explanation of how the fraud unfolded, analysts still had many questions.

Societe Generale alleges that Kerviel used other people's computer access codes, falsified documents and used other methods to cover his tracks — helped by his previous experience in other offices at the bank that monitor traders. It says he bet some 50 billion euros ($73.53 billion) — more that the bank's market worth — on European markets.

Seven ways to spot a liar on the job

By Ken Osborn

How many times has your business suffered because you trusted the wrong person? If you're like most people, you've been lied to thousands of times.

Deception hurts in many ways. There's the emotional stress from being betrayed, the loss of self-confidence and the increased suspicion or even paranoia. Not to mention the financial cost.

A deceptive supplier may promise that a shipment will arrive by your deadline, all the while knowing that delivery by the promised date is impossible. Trusting this supplier could cost your company thousands of dollars or more. Deceptions like this can be deadly to a growing business.

But you don't have to be a victim. Here are seven subtle cues that often mean a person isn't being completely honest with you.

1. Nose touch: We have erectile tissues in our noses, which engorge with blood when we lie. This causes a tingling or itching sensation that requires a nose touch to satisfy. The absence of a nose touch doesn't guarantee truth, but the presence of a nose touch often means deception. Of course, sometimes a person will touch his or her nose because of a non-deceptive cause, such as a cold. With some practice, you can quickly learn to distinguish a deceptive nose touch from something innocent.

2. Speech disturbances: When we lie, we force our brain to pretend that the lie is true, that the truth is a lie and simultaneously remember that the real truth is that each is the other. Are you confused? So is your brain when you lie. The process of deception taxes our cognitive ability to think efficiently. So when we lie, we pause longer and speak slower than normal and often experience speech disturbances that serve as gap fillers, such as "um," "er" and "ah." Train yourself to look for deception when you hear this kind of verbal cue.

3. Incongruent behavior: When our words and our body language don't agree, our communication is incongruent. Imagine that you ask a salesman if he can assure your delivery will be on time. If he explains how certain he is about it being on time while also shaking his head--as if non-verbally saying "no"--he is incongruent. When this sort of incongruence occurs, you would do well to believe the person's body over his words.

4. Neck rub: We rub our necks because of the stress we experience when we feel that an obstacle may be insurmountable. Let's say you're interviewing a potential employee for a key leadership position and the prospective employee verbally emphasizes his interest in the job. However he also begins to rub his neck when you explain the expected duties. This probably means he doesn't feel he'll be able to accomplish the duties. He might be wrong, but if we know anything about human psychology, it's that if someone believes that they can or can't do something, they're probably right.

5. Eye rub: An eye rub is an indicator of disbelief. Let's say you have an important computer keystroke sequence to teach a new employee. The employee begins to rub her eyes even while verbally affirming your statements. This probably means that she doesn't believe you or disagrees with your instruction. It would be wise to stop and ask a question to allow the employee to verbally object. Many subordinates feel uneasy about disagreeing with the boss, but their bodies don't hesitate. Perceiving a potential problem and dealing with it early can be the difference between a simple misunderstanding and a business disaster.

6. Upward inflections: We upwardly inflect our words when asking a question. You may have noticed that some salespeople will upwardly inflect certain statements of fact. This is a red flag that should alert you to potential deception. The salesman might say, "Your competitors have seen their profit margins increase by 30 percent by using our product." If you notice that he upwardly inflected the words, "30 percent," you should disregard this statistic and be suspicious of him altogether.

7. Stabbed hollows: In the study of graphology--or handwriting analysis--hollow letters represent honesty. Anything that disrupts a hollow letter could indicate deception. Let's pretend you enter your office to find a note from your top salesman on your desk. His note indicates that he had to go out of town to visit his sick mother and won't be able to go to the annual trade show. You notice that every "o" in his note has some sort of mark interjected into the hollow space of each letter. You would be right to be suspicious of the facts in the note and a phone call or meeting would likely expose some sort of deception.

With some practice, these new awareness tools will give you greater confidence in your perceptive ability and new peace of mind when deciding to trust others.

Profitable Jobs You Can Do From Home

Ysolt Usigan, ClassesUSA

In today's world of high connectivity, anyone can do virtually anything from home. In fact, the International Telework Association and Council reports that approximately 23 million people work at home at least part time, a number expected to increase as workplace technology becomes more and more seamless. If clocking in from your kitchen is the right choice for you, read on for telecommuting tips from successful home-office professionals.

Computer Software Production

Scott Testa knew that the competition for landing a convenient telecommuting job was tough, so he used education to distinguish himself.

After earning a Ph.D. in education through Drexel University's online program, Testa founded numerous software companies. He currently works from home as the chief operating officer of Mindbridge Software.

His biggest driver of success? The mindset that working from home must reflect the same initiative and motivation you would have if you were physically in the office. "Dress for work and keep the same hours you typically would in the office," he advises.

Marketing and Public Relations

Shannon Cherry, a marketing and public relations firm owner who does much of her work via e-mail, is accustomed to using the Internet for advancement -- she even earned her master's degree in communications administration from the University of Memphis online.

If you wish to secure an in-demand telecommuting position, Cherry stresses the power of effective communication. "It's important that you learn to brand yourself early on," she asserts. "That means you need to market your uniqueness."

Along with her master's degree, what distinguishes Cherry is her trustworthiness and reliability. "I suggest taking that a step further," she adds. "Market yourself by using stories or testimonials to clients or prospective employers. And network like crazy."

Financial Consulting and Sales

Anthony Shafer, a commercial finance consultant for LoanFight, Inc., usually works in his home office from 10 a.m. to 10 p.m., or even as late as 1 a.m. "With time differences, I have to get a hold of people at all hours of the day," he explains.

Shafer admits that TV can be a distraction, although it's actually a requirement for his job. "I keep CNBC on so I can follow the financial world," he says. Understanding the line between work and play is key to staying focused.

Also important are desire and devotion, says Shafer, who is currently working on his business information systems degree from DeVry Online. "You've got to be a salesman, and do it with a serious desire to please people," he says.

Graphic Design

Most graphic design work available to telecommuters is on a freelance basis, which means missing out on benefits like health insurance, steady salary, and job stability.

Jill Sabato, a recent graduate of the School of Visual Arts, tried freelance design projects when she was in between jobs. "When you've got bills to pay, it's not a good idea to count on the money you'll make from a project," she says. "Who knows when you'll get another assignment?"

If you do find a company with which you're comfortable, be sure to give your best. "If you freelance for a company that knows your work and is happy with it, stick with them," says Sabato. "Keep in contact so they know they can always count on you for projects."

7 Highly Rated Stocks on Sale

By Matt Koppenheffer

I'm always looking for a good deal, whether that means buying an extra box of Cocoa Puffs when they're on sale, or pouncing on undervalued stocks. The idea that anybody would sell a stock for less than its worth may seem silly, but legendary value investor Ben Graham tells us, by way of allegory, how we can look out for these situations.

In The Intelligent Investor, Graham introduces readers to a crazy guy named Mr. Market. Mr. Market's game is to pay you house calls on a daily basis, offering to sell you interests in businesses he owns, or to buy from you interests in businesses you own. Sometimes, Mr. Market will show up at your door very excited, offering you premium prices for your holdings. Other times, he'll be totally depressed about the future, offering to sell you what he has for as low as pennies on the dollar.

To find some of the stocks that Mr. Market is depressed about, I've turned once again to The Motley Fool's CAPS investor community. Each of the companies below had been given a five-star rating (the highest) by our community of investors just 30 days ago:

Stock	30-Day Return	One-Year Return	Current CAPS Rating
ProCentury (Nasdaq: PROS)	(22.28%)	37.30%	****
CT Communications (Nasdaq: CTCI)	(17.87%)	37.21%	*****
Gammon Lake Resources (AMEX: GRS)	(15.93%)	10.96%	***
Northgate Minerals (AMEX: NXG)	(13.9%)	(10.73%)	*****
Aurizon Mines (AMEX: AZK)	(14.07%)	19.57%	*****
United Retail Group (Nasdaq: URGI)	(11.9%)	(13.35%)	****
ICT Group (Nasdaq: ICTG)	(15.4%)	(30.65%)	****

Data from Motley Fool CAPS as of May 22.

As the chart shows, these stocks are all still very well-regarded by the CAPS community despite their underperformance over the past month. While these are not formal recommendations, they could be a great place to kick off some further research. I'll even get you started with some thoughts on ProCentury.

A question of risk
If you face a major financial risk, there's a good chance that you can find an insurer willing to take some of that risk off your hands. Whether it's a car accident, a hurricane, or even death, at least some financial solace can be found for most of life's major mishaps.

Many types of risks, particularly those that businesses take on, do not work well with the one-size-fits-most approach that works for standard lines like life or car insurance. That's where insurers like ProCentury step in. ProCentury is a niche property and casualty insurer covering small and midsize businesses such as day care facilities, retail stores, and fitness centers on risks outside those covered by mainline insurers.

Investors let the company know they weren't happy with its recent earnings announcement by cutting the price on the stock 15%. Though earnings per share met Wall Street's expectations, up 14% year over year, revenue fell short. In particular, gross premiums for the quarter were up just 1% year over year, and net premiums declined slightly.

ProCentury's CEO attributed the slow premium growth to competition, along with tightened underwriting standards on an underperforming program. The competition is worrisome, but it might be encouraging that the company is more willing to show slow growth than try to undercut competitive pricing.

Profitability for the quarter was salvaged by strong growth in investment income and a slightly lower combined ratio -- the percentage of earned premiums spent on losses and operating expenses.

CAPS players seem to see the recent dip as a good opportunity to take a look at ProCentury shares. Damondicus said the company's "excellent fundamentals and long-term growth make this pick easy." Prior to the quarter, CAPS All-Star adprintz saw "very solid fundamentals across the board on [ProCentury]." He added that "I love a lot of the insurers right now because they are cheap compared to historical values."

Is ProCentury done shedding value and ready to take off? Let the community know what you think -- head over to CAPS and share your thoughts with the other 29,000 players currently part of the community. Even if you'd prefer to pass on ProCentury, you can check out a couple of the other stocks listed above, or any of the 4,500 stocks rated on CAPS.