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Olympus, former officials charged: prosecutors

09 march 2012, 15:20
Former Olympus chairman and president Tsuyoshi Kikukawa (R) and vice president Hisashi Mori (L). ©AFP
Former Olympus chairman and president Tsuyoshi Kikukawa (R) and vice president Hisashi Mori (L). ©AFP
Japanese prosecutors said Wednesday they had charged scandal-hit Olympus and three former senior executives over a huge loss cover-up, AFP reports.

It came as the 20-day detention period of former president Tsuyoshi Kikukawa, named as a key player in a scheme to shift $1.7 billion of losses from the camera-maker's balance sheet, expired.

Tokyo District prosecutors said Kikukawa, two other former Olympus executives, Hideo Yamada and Hisashi Mori, and three financial advisers conspired to falsify the company's balance sheet in fiscal 2006 and 2007.

The same charge was also laid against Olympus as a corporate entity.

Prosecutors also arrested the three disgraced former Olympus officers and financial adviser Akio Nakagawa for lying in financial documents relating to fiscal 2008, fiscal 2009 and fiscal 2010.

They will have 20 days to decide whether to charge them on these separate counts.

Olympus Corp. also faced the same fresh suspicions, the prosecutors said.

The move followed a request from the Securities and Exchange Surveillance Commission, which on Tuesday urged prosecutors to sue the men and the company.

The Tokyo Stock Exchange (TSE) said criminal charges against the company would not in themselves mean Olympus would be expelled from the exchange.

"We will consider whether to delist Olympus or not if prosecutors disclose fresh facts, but an indictment on facts we already know is not a condition for delisting," a TSE spokesman told AFP.

Olympus shares ended the morning session 1.15 percent down at 1,285 yen, with investors largely unmoved by the announcement of the expected indictment that came shortly before the lunch break.

The scandal, which has seen Olympus haemorrhage value on the Tokyo Stock Exchange, erupted in a blaze of international publicity when British chief executive and president Michael Woodford was sacked in October.

The 92-year-old firm eventually admitted a small group of top executives used overpriced deals to cover up bad investments dating back to the 1990s, making it one of the country's biggest ever financial scandals.

Following his sacking, Woodford launched aggressive media offensives against his former bosses, questioning the firm's past acquisition deals and the outsized consultant fees it had paid.

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