TOKYO ? A panel probing an accounting scandal at Japan's Olympus Corp. said Tuesday it found an elaborate scheme to cover up $1.5 billion of investment losses but no evidence of Japanese mafia involvement.
The panel also credited the company's ex-CEO, Michael Woodford, for bringing the wrongdoing to light. Woodford, a Briton, was fired in October after raising questions about the dubious transactions that have become one of Japan's biggest corporate fiascos.
Led by former Supreme Court judge Tatsuo Kainaka, the panel found that as of 2003, Olympus had racked up 117.7 billion yen ($1.5 billion) in investment losses dating back to the 1990s.
It said it found no involvement of "anti-social groups," a reference to the Japanese criminal gangs, as some news reports have speculated. The panel said it traced the money and the various funds used to cover up investment losses, and no underworld groups were involved.
Olympus initially denied any wrongdoing, but later acknowledged that it had used inflated advisory fees when it bought British medical instruments maker Gyrus Group, as well as overpayments for acquisitions, to hide losses from past investments gone bad.
The panel identified at least six Olympus employees as part of the scheme, including former President Tsuyoshi Kikukawa, former Executive Vice President Hisashi Mori and ex-auditor Hideo Yamada, all of whom have resigned.
But it said other board members were familiar with the scheme that started from about 2006 and lasted through last year, and recommended they, too, resign.
It urged Olympus to beef up its corporate governance to prevent future problems, pointing to a small group of people who engineered the scheme but were protected so that the dubious accounting could be kept secret for so long.
The panel pointed to one board meeting in which a part of the scheme was approved in just 15 minutes.
It stressed its findings, summarized in a 24-page document released at a press conference at a Tokyo hall Tuesday, were based on voluntary hearings and analysis of company computers, but that it was not authorized to pursue a criminal investigation.
Japanese financial and criminal authorities are investigating the Olympus scandal.
Kainaka, the former judge, said that some Olympus people may face criminal charges, while declining to give names. He said none had pocketed the money for personal gain.
Olympus risks being delisted from the Tokyo Stock Exchange if it doesn't rectify past filings with regulators by reporting revised earnings by Dec. 14.
The company's bookkeeping is now under investigation in Japan, the U.S. and Great Britain. Woodford has met with authorities in all three countries.
The scandal has cast a harsh light on Japanese corporate governance, which has been criticized as lagging global standards.
Last week, Economy Minister Yukio Edano defended Japan, saying its corporate governance standards were on par with the U.S. or even better. He didn't specify any cases, but there have been a string of accounting scandals at major U.S. companies, including Enron and AIG.
Kainaka denied the Olympus scandal exemplified Japan Inc.
"This is not just a Japan problem. It could have happened anywhere in the world," he said.
Olympus stock, which at one point lost 80 percent of its value after Woodford's whistleblowing, has recovered over the last three weeks, and surged 9 percent Tuesday amid optimism the company may avoid delisting. The panel released its findings after the Tokyo Stock Exchange closed.
___
Follow Yuri Kageyama on Twitter at http://twitter.com/yurikageyama
heavy d dead heavy d dead alaska weather alaska weather election results gop debate live gop debate live
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.