PARIS: A French appeals court delayed until Tuesday a decision on whether to release Jйrфme Kerviel, the former trader blamed for nearly \5 billion of losses at the bank Sociйtй Gйnйrale, from pretrial custody, lawyers involved in the case said Friday.

Lawyers for Kerviel, 31, had requested the hearing Friday to appeal his detention, arguing that there was no risk that he might flee or otherwise jeopardize the investigation into his unauthorized trading, which ultimately exposed the bank to nearly \50 billion of risk. The 31-year-old former trader has been held in a Paris prison since Feb. 8.

“The court is right to take its time,” said Frйdйrik-Karel Canoy, a lawyer representing a group of Sociйtй Gйnйrale shareholders that is suing the bank for failing to detect Kerviels fraudulent trades earlier. “There are serious consequences for both sides.”

Kerviel has acknowledged making dozens of unauthorized speculative bets with the banks money over a period between early 2005 and January 2008 and hiding them using various methods, including inputting fake trades and fabricating documents. The bank has filed a criminal complaint alleging forgery, breach of trust and illegal computer use.

Prosecutors argue that Kerviel should remain in detention because there is still a risk that he could flee or contact people who could influence the outcome of the investigation if he were to be released. They have also expressed concern about the former traders mental state.

The judges leading the investigation, Renaud Van Ruymbeke and Franзoise Desset, last week ordered that Kerviel undergo a psychiatric evaluation aimed at determining if his judgment may have been impaired during the nearly two years in which he conducted his trades, which grew progressively larger over the course of 2007. The outcome of that evaluation has not been made public.

Legal experts said the fact that three judges presiding over the appeals court hearing chose to deliberate until Tuesday before making a decision suggested that they were considering releasing Kerviel.

“It is an unusual delay,” said Stйphane Bonifassi, a Paris-based lawyer and member of FraudNet, the International Chamber of Commerces commercial crime unit. “In detention matters, a decision is usually rendered on the day of the hearing itself or the following morning.”

He added that if the court did decide to release Kerviel, it could signal that his ultimate sentence, if he is convicted, might be more lenient.

“Jйrфme Kerviel has admitted that he made mistakes and did not abide by the rules,” Bonifassi said. “You could say that if he is released now, it would give a sign that, if hes found guilty, the sentencing will not be terribly harsh.”

If convicted, Kerviel faces up to five years in prison and \375,000 in fines.

Kerviel has never disputed the banks claim that he was the sole architect of an elaborate ruse involving scores of fake trades that exposed the bank to as much as \50 billion of risk. However, he has said he would not be made a “scapegoat” for the banks lapses in oversight, and has argued that his superiors tacitly approved his activities as long as they were generating profit. Kerviels unauthorized trades generated \1.4 billion in profit for Sociйtй Gйnйrale in 2007, but his bets turned sour in mid-January as global stock markets tumbled.

A preliminary report published Feb. 20 by a committee of independent Sociйtй Gйnйrale board members found no evidence to suggest that Kerviel, profited personally from his actions or that he had acted with the help of accomplices.

The committees report also found that Sociйtй Gйnйrale had failed to follow up on at least 74 red flags raised by its risk control officers, compliance officers and accountants between June 2006 and January. Controllers duly followed the banks procedures but rarely went beyond required checks, the report said, even when the size of Kerviels bets was abnormally large for a trader of his experience and standing at the bank.

The bank disclosed on Jan. 24 that it had lost a net \4.9 billion in the process of closing out Kerviels trades. The loss prompted the company to seek an emergency capital infusion of \5.5 billion last month and has raised speculation of a possible takeover bid for the 144-year-old French bank.

Kerviel can be held in provisional custody for up to four months. At that point, he would have to be released, even if the investigation has not yet concluded.

In France, before formal charges can be brought, a judge must complete an investigation, a process that legal experts said could take months or even years.

NEW YORK: U.S. stocks plunged early Friday as investors worried that a plan to ease a liquidity crisis at Bear Stearns

indicates how severe credit troubles have become. Each of the major indexes lost more than 1 percent; the Dow Jones industrials fell more than 250 points.

Investors were busy examining a plan from JPMorgan Chase and the New York Federal Reserve to provide secured funding to Bear Stearns for an initial period of 28 days. The move offers Bear Stearns relief from a sudden liquidity crunch and could help instill confidence in the stagnant credit markets.

Bear Stearns shares fell sharply, dragging down other financial companies. The stock fell $14.05, or 25 percent, to $42.95.

Stocks showed moderate gains in the early going after a Labor Department report showed the consumer price index remained flat for February. Wall Street has been expecting inflation would show an increase.

But the gains quickly disappeared after investors learned more about how close Bear Stearns appeared to have come to financial implosion.

“The Bear Stearns news reversed the early positive sentiment from the inflation data,” said Peter Cardillo, chief market economist at Avalon Partners. “There had been nervousness about Bear Stearns for some time and now the markets concerns about the company have been proven true.”

In the first hour of trading, the Dow Jones industrial average fell about 257 points to the 11,888 level.

PARIS: A French appeals court delayed until Tuesday a decision on whether to release Jйrфme Kerviel, the former trader blamed for nearly \5 billion of losses at the bank Sociйtй Gйnйrale, from pretrial custody, lawyers involved in the case said Friday.

Lawyers for Kerviel, 31, had requested the hearing Friday to appeal his detention, arguing that there was no risk that he might flee or otherwise jeopardize the investigation into his unauthorized trading, which ultimately exposed the bank to nearly \50 billion of risk. The 31-year-old former trader has been held in a Paris prison since Feb. 8.

“The court is right to take its time,” said Frйdйrik-Karel Canoy, a lawyer representing a group of Sociйtй Gйnйrale shareholders that is suing the bank for failing to detect Kerviels fraudulent trades earlier. “There are serious consequences for both sides.”

Kerviel has acknowledged making dozens of unauthorized speculative bets with the banks money over a period between early 2005 and January 2008 and hiding them using various methods, including inputting fake trades and fabricating documents. The bank has filed a criminal complaint alleging forgery, breach of trust and illegal computer use.

Prosecutors argue that Kerviel should remain in detention because there is still a risk that he could flee or contact people who could influence the outcome of the investigation if he were to be released. They have also expressed concern about the former traders mental state.

The judges leading the investigation, Renaud Van Ruymbeke and Franзoise Desset, last week ordered that Kerviel undergo a psychiatric evaluation aimed at determining if his judgment may have been impaired during the nearly two years in which he conducted his trades, which grew progressively larger over the course of 2007. The outcome of that evaluation has not been made public.

Legal experts said the fact that three judges presiding over the appeals court hearing chose to deliberate until Tuesday before making a decision suggested that they were considering releasing Kerviel.

“It is an unusual delay,” said Stйphane Bonifassi, a Paris-based lawyer and member of FraudNet, the International Chamber of Commerces commercial crime unit. “In detention matters, a decision is usually rendered on the day of the hearing itself or the following morning.”

He added that if the court did decide to release Kerviel, it could signal that his ultimate sentence, if he is convicted, might be more lenient.

“Jйrфme Kerviel has admitted that he made mistakes and did not abide by the rules,” Bonifassi said. “You could say that if he is released now, it would give a sign that, if hes found guilty, the sentencing will not be terribly harsh.”

If convicted, Kerviel faces up to five years in prison and \375,000 in fines.

Kerviel has never disputed the banks claim that he was the sole architect of an elaborate ruse involving scores of fake trades that exposed the bank to as much as \50 billion of risk. However, he has said he would not be made a “scapegoat” for the banks lapses in oversight, and has argued that his superiors tacitly approved his activities as long as they were generating profit. Kerviels unauthorized trades generated \1.4 billion in profit for Sociйtй Gйnйrale in 2007, but his bets turned sour in mid-January as global stock markets tumbled.

A preliminary report published Feb. 20 by a committee of independent Sociйtй Gйnйrale board members found no evidence to suggest that Kerviel, profited personally from his actions or that he had acted with the help of accomplices.

The committees report also found that Sociйtй Gйnйrale had failed to follow up on at least 74 red flags raised by its risk control officers, compliance officers and accountants between June 2006 and January. Controllers duly followed the banks procedures but rarely went beyond required checks, the report said, even when the size of Kerviels bets was abnormally large for a trader of his experience and standing at the bank.

The bank disclosed on Jan. 24 that it had lost a net \4.9 billion in the process of closing out Kerviels trades. The loss prompted the company to seek an emergency capital infusion of \5.5 billion last month and has raised speculation of a possible takeover bid for the 144-year-old French bank.

Kerviel can be held in provisional custody for up to four months. At that point, he would have to be released, even if the investigation has not yet concluded.

In France, before formal charges can be brought, a judge must complete an investigation, a process that legal experts said could take months or even years.