It is reported that French bank Societe Generale is facing a multi million pound claim relating to an alleged fraud that led to the collapse of Welsh steel mill Alphasteel.

The fraud, alleged to have taken place at its subsidiary Rosbank, has never been reported to SocGen shareholders. It took place within months of the French bank suffering the world's largest rogue trader loss at the hands of Jerome Kerviel.

Liquidators for Alphasteel claim Rosbank, or its employees, were complicit in a multi million pound fraud that preceded the 2007 collapse of the steel mill. Millions of pounds were advanced by Rosbank Switzerland to Alphasteel and other companies in Safa Group, an Iranian owned steel group.

In company filings dating back to 2008, Rosbank admitted it had suffered a GBP 130.9 million fraud relating to the collapse of an industrial group, now known to be Safa Group. This is the first time it has emerged that senior employees of Rosbank could have been complicit in the fraud.

As well as a possible legal claim in the Swiss courts, Rosbank, and through it SocGen, are facing a complaint to the Swiss regulator FINMA.

Alphasteel collapsed days before Christmas 2007 with the loss of 400 jobs. But it was not until liquidators to the Newport company started to bring proceedings against one of its advisors Iranian Shahram Shirkhani that the details surrounding the collapse emerged.

(Sourced from www.telegraph.co.uk)