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Recruit Co. Acts Against Executives Linked To Stock Scandal

March 26, 1989

TOKYO (AP) _ Shareholders of Recruit Co., the firm at the center of a stock-profiteering and bribery scandal, have voted to slash executives’ salaries, company spokesman Yasutaka Natsuka reported.

He said they also voted to deny retirement pay to the firm’s founder and former chairman, Hiromasa Ezoe.

About 30 major shareholders of the employment-information conglomerate, including company president Naotaka Ida, held a general meeting Saturday at the firm’s Tokyo headquarters to atone for any company wrongdoing, said Natsuka.

The scandal involves selling hundreds of thousands of unlisted shares in Recruit Cosmos, Recruit’s real estate susidiary, to political and business figures at discount prices before the shares were listed in the over-the- counter market. The shares soared in value after trading began, reaping large profits for the recipients.

News reports said the shareholders agreed to reduce Recruit executives’ monthly pay by up to 50 percent, with Ida’s salary cut in half. They said the shareholders decided to let Ida stay on as president at least for now while prosecutors pursue their investigations.

Prosecutors have questioned Ida about possible bribes to Labor Ministry officials in the scandal which has shaken the administration of Prime Minister Noboru Takeshita.

Ezoe and 11 other senior executives and government bureaucrats were arrested on suspicion of offering or taking bribes.

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