The US Attorney for the Eastern District of New York is taking the lead, the source said on Monday, referring to the investigation of Mr Robert A. Day, a board member of Societe Generale and investment manager of US-based Trust Co of the West.

The US Securities and Exchange Commission is also probing stock sales by Mr Day and by two foundations associated with him, The Wall Street Journal newspaper reported on its website on Monday.

Mr Day and the foundations sold about US$140 million (S$198 million) of the bank's stock some two weeks before the bank notified its board about the US$7.3 billion in trading losses, the Journal said, quoting unnamed sources familiar with the matter.

Societe Generale publicly revealed the huge trading losses on Jan 24 and blamed them on a single rogue trader, Jerome Kerviel.

The bank said on Monday its New York branch was contacted by the US Attorney's Office for the Eastern District of New York on Jan 25 regarding the trading losses it announced on Jan 24.

'The bank is cooperating fully with the investigation,' Societe Generale said in an e-mailed statement on Monday.

The bank had no immediate comment on the probe involving Mr Day.

The bank has already said Mr Day's sales were during a window of time when such trades were permitted under Societe Generale's trading policies for directors.

'No inside information was used in any way with respect to these December and January sales,' the bank said on Jan 29. 'Mr Day, like the other board members, was not advised of Mr Kerviel's trading losses.'

A spokesman for Mr Day, Mr Josh Pekarsky, echoed the bank's comments about selling stock when such trades were permitted.

'All required government disclosures were made. No inside information was used in any way with respect to these sales,' Mr Pekarsky said on Monday in an e-mail statement. 'Mr Day has pledged his cooperation into any inquiries of this matter.'

Two sets of small shareholders have filed a complaint about the trades alleging insider trading.

According to the Journal, US prosecutors have opened a criminal probe related to the bank, but no other details were given.

The FBI, SEC and US attorney's office in Brooklyn declined to comment.

In Paris, Economy Minister Christine Lagarde issued a report that said Societe Generale was warned last year its security systems were not up to par and listed other problems that had come to light during an investigation of France's second-largest listed bank. -- REUTERS