FRENCH bank Societe Generale today said it had become the victim of a major fraud case after a rogue trader cost it £3.7bn.

France's second biggest bank said that it discovered one of its traders had set up secretive positions in 2007 and early this year.

The fraud is one of the worst cases ever seen, with the losses far greater than those involved in the infamous rogue trader case in 1995, when Nick Leeson caused the collapse of Barings bank after racking up losses of about £800m.

Societe Generale said it was in the process of dismissing the trader, who has not been named.

The trader's managers are also leaving the company, but Societe Generale said it had rejected chairman and chief executive Daniel Bouton's offer of resignation.