SocGen Faces Fresh Bribery Probe in France Over LIA Dealings

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By Gaspard Sebag

  • Prosecutors to look at bank’s Libyan Investment Authority work
  • SocGen says it got judicial requests in September, October

Societe Generale SA faces a fresh investigation in France into alleged bribery related to the bank’s work with the Libyan Investment Authority, adding to legal woes that have been putting pressure on its earnings.

Societe Generale received two judicial requests for information in September and October as part of a preliminary probe opened by France’s Parquet National Financier into possible violations of anti-corruption laws. The investigation opened by French financial prosecutors was revealed in a filing updating the bank’s annual report.

“The requested documents are currently being passed onto French authorities,” Societe Generale said in the filing released late Monday. French financial prosecutors didn’t have an immediate response to requests for comment, while a Societe Generale spokeswoman declined to comment beyond what’s in the filing.

The bribery case has haunted the French lender for years. In May, SocGen agreed to pay 963 million euros ($1.1 billion) to the LIA to settle a civil lawsuit in London. The bank is also seeking to resolve the U.S. Justice Department’s criminal investigation into the matter. The case hinged on a $58.4 million payment allegedly made by the bank to a businessman named Walid Al-Giahmi to secure investment deals.

Officials at France’s financial prosecutor said the LIA preliminary investigation was opened last November at its own initiative following the publication of news articles.

Societe Generale set aside earlier this month an additional 300 million euros — to reach a total of 2.2 billion euros — for potential litigation expenses as it entered talks with U.S. authorities to resolve the bribery probe related to Libya and an investigation into alleged fake submissions of Libor rates. The bank added that these matters could be resolved “in the coming weeks or months.”

Societe Generale shares had their biggest two-day decline in more than a year as the bank posted third-quarter results Friday after plunging demand for the derivatives products turned its traditional strength into a weakness.

— With assistance by Fabio Benedetti Valentini

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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