“It must be a typo” was my reaction today upon reading the New York Times headline online: “Fraud costs bank $7.1 Billion.” Perhaps the headline was supposed to be about banks, plural, and the story was about fraud losses over the years. Or maybe the amount was $7.1 million.

But no. France’s second largest bank, Société Générale, disclosed today that one rogue trader caused $7.1 billion dollars in losses. As is common in our experience, the trader did not appear to have personally profited from the trades.

Bank spokespeople are claiming that Jerome Kerviel was able to perpetuate this fraud because he used to work in the risk management office and thus was able to breach five levels of controls. Plus he was “a computer genius.”

Outside experts are criticizing the banks internal controls. Société Générale states that their internal controls “have been revised and reinforced to avoid any reoccurrence of further similar risk.” They have also fired five individuals, including Kerviel’s supervisor and the head of global equities and derivatives trading.

My hunch is they may want to look at the most critical internal control: culture. It is very difficult to believe that any one individual, even a “computer genius,” could pull off a fraud of such magnitude without awareness by anybody else at Société Générale.

I have had the privilege of conducting a lot of ethics training in France. Most of the time, in response to hypothetical case studies, I hear that “reporting the misconduct of others is not our job. To do so is not the French way. It is the responsibility of management to find this out and do something about it.”

I wonder what the employees of Société Générale think about this cultural value now. What do the shareholders think? This case provides $7.1 Billion reasons for working to build a culture where people take responsibility for acting when they suspect illegal conduct.