Regulators in London and Paris have launched an insider dealing investigation into whether anyone improperly profited from knowledge of Société Générale's catastrophic €5 billion (£3.7 billion) rogue trader scandal before the news was made public on Thursday, The Times has learnt.

The Financial Services Authority (FSA) and its counterpart in France, the Autorité des Marchés Financiers (AMF), are looking at whether anyone placed highly lucrative investment positions in anticipation of SocGen's desperate need to unwind the huge bets on Monday and Tuesday.

The AMF is also expected to examine trading in the shares of SocGen.

The price dived on Wednesday, before the problem was made public, providing opportunities for profit for those with knowledge of the SocGen's losses.

The potential for serious market abuse was high because SocGen took five and a half days after it learnt of rogue trader Jérôme Kerviel's activities to go public on the disaster.

Its own efforts to unwind the huge bets added to the downward pressure on share prices early this week, giving insiders the opportunity to make virtually guaranteed profits by shorting the relevant securities — European index futures.

There were unconfirmed suggestions today that Mr Kerviel may have confided in a friend who worked at a rival investment bank last Sunday.

Many other people inside and outside SocGen knew of the problem by Monday morning, including the Banque de France and the AMF.

The pool of professionals "in the know" is thought to have mushroomed during the early days of the week as SocGen drafted in JPMorgan and Morgan Stanley to orchestrate the €5.5 billion emergency capital-raising, which was also formally unveiled on Thursday.

One regulatory lawyer in the City told The Times: "Regulators will be keen to see whether anyone was privy to that information and traded improperly on it because that might constitute market abuse."

Although insider dealing usually refers to trading in an individual company's shares, the market-abuse rules in Britain and on the Continent can also apply to index trading so long as the information is not generally available and is precise enough.

SocGen had little choice but to keep the rogue trades quiet until after it had closed them all out.

If it had gone public, markets could have moved even more aggressively against it, leading to even bigger losses than the eventual £3.7 billion hit.

Bank supervisers are expected to advise banks to redouble their scrutiny of controls governing their traders.

The FSA is particularly keen to emphasise the importance of segregating the activities of the front office (the traders) from the middle office and back office (risk management and clearing and settlement).

It was Mr Kerviel's former job in the middle office of SocGen that gave him the expertise to circumvent the normal controls.

The FSA is telling banks that anyone promoted from the back or middle office to a trading position should have a note made on their file, alerting their managers to the potential risk.

Small banks, in particular, sometimes have poor segregation.

The internal audit and compliance function is also being emphasised.

Employees in this area should be able to report concerns right to the top, bypassing the chief executive if necessary, and going straight to the non-executive director chairing the audit committee.

"Every major bank will be re-examing its systems and procedures in the aftermath of this disaster," Howard Radley, of Radley & Associates, the banking consultant, said.

"Whenever there's a disaster, the financial services industry is famous for closing the stable door after the horse has bolted. Unfortunately, they are always fighting the last war.

"There will be more disasters."

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