Jan. 27 (Bloomberg) -- Jerome Kerviel is no hero.

If you have forgotten, he’s the Frenchman whose unauthorized trading at Societe Generale SA a year ago -- Jan. 24 to be exact -- cost the bank 4.9 billion euros ($6.4 billion).

France’s financial community was shocked, while many Americans, wondering how such a mess could happen, smugly chuckled at French ineptitude. Then along came the massive losses emanating from the subprime crisis and Bernard Madoff, whose $50 billion Ponzi scheme leaves Kerviel in the shade.

In France, Kerviel has garnered a lot of misplaced public affection. He’s regarded as the little guy doing battle with a big institution run by the old boys who attended the elite Grandes Ecoles.

The former SocGen trader has inspired a comic book, a fan club and T-shirts. Last year, the Nouvel Observateur magazine dubbed him the “Che Guevara of Finance.” Le Monde called him “a hero of our time.”

By contrast, Madoff lives in a $7 million Manhattan Upper East Side apartment in New York and owns several properties, four boats and three cars. He’s no little guy. He did, however, dupe many of his own class, which may inure him to the French.

Kerviel has admitted lying, faking trades, falsifying authorizations, and hacking into computers. But he resents the “fraudster’ and “terrorist” labels that Societe Generale has tried to pin on him. He has also kicked back, stating that the Paris-based bank knew or should have known about his actions.

Hall of Shame

No matter how poor SocGen’s risk controls were or how negligent its management, Kerviel shouldn’t be lionized. Nor should other members of the Financial Hall of Shame.

Kerviel has said he personally never profited from his excessive trading and that Societe Generale is responsible for the losses because of the way in which it unwound his trading positions. That’s no excuse.

Nick Leeson, the English trader whose $1.4 billion loss sank Barings Plc in 1995, was sentenced to 6 1/2 years in a Singapore prison. He now has his own Web site, has written two books, lectures to financial institutions and companies on, of all things, managing risk, and is the subject of a movie -- “Rogue Trader” -- starring Ewan McGregor.

Nobody has made a film about Madoff, but you can bet that someone will. When they do, it should portray how the breakdown in managerial oversight and regulation played a major role in both the Kerviel and Madoff affairs. Harry Markopolos, a former money manager, highlighted Madoff’s misdeeds to the Securities and Exchange Commission, only to be ignored.

‘Alert Signals’

The picture at Societe Generale was one of fragmented internal controls, poor supervision and missed “alert signals.” Bank management also overlooked warnings from Eurex AG, Europe’s biggest futures exchange, concerning Kerviel’s positions.

The losses and trading strategies gone awry represent not simply the missing assets of some amorphous wealthy institution but the savings, retirement nest eggs, college tuitions and health-care safety nets of families and individuals.

In its quest for bonuses, the finance community loses sight of the people at the other end of every transaction. Kerviel acknowledged as much in an interview last week with Le Parisien, a Paris newspaper.

“The bank never says, ‘Attention guys; the money you’re playing with is not virtual,’” Kerviel said. “‘At the other end of your computer, there are real people with real lives.”

No Gun Needed

Although he never used them, notorious American bank robber Willie Sutton usually carried a pistol or sub-machine gun on robberies. “You can’t rob a bank on charm and personality,” he said. Maybe not, but Madoff and Kerviel prove you don’t need a gun to do the job.

People generally don’t like banks and tend to applaud their comeuppance, a loathing that dates back to biblical usury laws. Jesse James, famed 19th-century American stick-up artist, was cast as a modern-day Robin Hood. The bank-robbing Sutton was so popular that at age 69, the New Britain, Connecticut, Bank and Trust Co. hired him to make a television commercial promoting its new photo credit-card program.

Still, surveys show that U.K. and French citizens are more likely to change spouses than banks during their lifetimes. That’s pretty sad.

It would be nice to think that the fallout from Kerviel and Madoff will be better regulation, restraint and a stronger sense of social responsibility.

Don’t bet on it.

(Michael R. Sesit is a Bloomberg News columnist. The opinions expressed are his own.)

To contact the writer of this column: Michael R. Sesit in Paris at at msesit@bloomberg.net

Last Updated: January 26, 2009 19:00 EST