Jérôme Kerviel, the former trader whose risky market betting left the French bank Société Générale facing one of the biggest financial scandals in history, has been jailed for three years after a judge ruled he secretively broke rules and threatened the stability of his firm and the global financial order.

Standing in a black suit and tie in Paris's Palais de Justice this morning, the 33-year-old stared ahead of him as the judge Dominique Pauthe found him guilty of forgery, breach of trust and computer abuse.

He was given a five-year prison sentence, including two years suspended. In a verdict that caused an audible gasp from observers in court, he was ordered to pay damages to Société Générale of €4.9bn (£4.1bn), the total sum of money which his market strategies lost for the bank.

Defence lawyer Olivier Metzner immediately announced his client would appeal against the "unreasonable" ruling.

"Jérôme Kerviel is being made to pay for a system. He is revolted; revolted that those who created it have been exonerated of all blame. You can see it in his face," Metzner said after the verdict, as Kerviel sat bent over and staring at the floor.

Throughout the three-week trial in June, the man once known to trading floor colleagues as "Cash Machine" maintained that, although he had undoubtedly taken excessive risks and got trapped in a spiral of his own creation, he was doing it "to earn money for the bank".

While pleading guilty to computer abuse, he denied the other two charges, insisting his superiors had known all along about his risks and had turned a blind eye. He was, said his lawyer, the scapegoat for a system in crisis.

In a 73-page judgment, however, Pauthe dismissed this argument point by point. He said Kerviel had been perfectly aware he was going beyond his remit as a trader, and no one had been able to prove that his bosses at the bank had known what he was doing.

"The material presented by the defence does not allow us to conclude that Société Générale knew about the fraudulent activities of Jérôme Kerviel," said Pauthe in his judgment.

"Through his deliberate actions, he put in danger the solvency of the bank employing 140,000 people, including him, whose future was found to be seriously endangered," he said. "In their size, their specificity and the context of crisis in which they occurred, these acts undoubtedly harmed the international economic public order."

The ruling comes as a triumph for France's second-largest bank, which has always insisted the loss was the work of a secretive lone trader bent on maximising his own bonus and impressing his colleagues with spectacular results. Unusually for a trading scandal, however, there was never any implication that the Brittany-born trader was trying to embezzle any of the money he made.

When Société Générale discovered in early 2008 that it was exposed to €50bn in uncovered trades carried out by Kerviel, panicked directors desperately tried to wind up his positions. The ensuing crisis, which came amid growing concern over the subprime market and several months before the collapse of Lehman Brothers in the US, damaged the reputation of SocGen, as it is known in France.

Fined €4m in 2008 by the French banking watchdog for internal failures which allowed Kerviel to continue his trading apparently undetected, the bank has since spent millions on strengthening those controls to ensure the same does not happen again.

Jean Veil, the bank's lawyer, welcomed the verdict. "When you have employers or staff members, you don't check in the evening to make sure they're not leaving with the cutlery or your belongings; you trust them," he told journalists, reiterating his argument that the entire business could not be held responsible for one errant employee.

The €4.9bn euro question



"Four billion, nine hundred and fifteen million, six hundred and ten thousand, one hundred and fifty four euros," read out Judge Dominique Pauthe from his hefty pile of papers.

The sum totalled the amount lost to Société Générale by Jérôme Kerviel. It was also the sum that Kerviel was yesterday ordered to pay to the French bank in damages – the first time a French court has issued an order running into billions. With his IT consultant's salary of around €2,300 per month, it would take him over 170,000 years to clear the sum.

But, despite predictions that the one-time high-earner could be forced onto the breadline for the rest of his life, the bank insisted the request for damages had been merely symbolic and that it would not be chasing him for cash.