Related topics

Nomura president admits illegal payoffs at hearing

July 24, 1997

TOKYO (AP) _ A top official of Nomura Securities Co. admitted to government officials today that the nation’s largest brokerage violated Japanese law by making illegal payoffs to a corporate racketeer.

Nomura has been charged with violating Japan’s securities and exchange law, which bans dealings with racketeers, commonly known as ``sokaiya.″

In a 50-minute hearing at the Finance Ministry, Nomura President Junichi Ujiie accepted most of a government commission’s findings against Nomura. The hearing was part of preparations for slapping administrative penalties against the company.

A ministry official, speaking on condition of anonymity, said the ministry has the power to cancel Nomura’s license or order it to suspend some or all operations for up to six months.

The official refused to say what penalties will be taken, but an announcement is expected within weeks.

Nomura’s former president, Hideo Sakamaki, and two former executives were formally charged on July 9 for illegally paying off suspected sokaiya Ryuichi Koike in 1995.

Sokaiya extort money by threatening to disrupt shareholders’ meetings by shouting angry questions and making embarrassing disclosures.

Sakamaki and former executive Nobutaka Fujikura paid $2.8 million in cash to Koike in March 1995 to ensure that Nomura’s shareholders’ meeting two months later would go smoothly, according to prosecutors.

Prosecutors have said the payment to Koike, who owned more than 1,000 Nomura shares, was in the form of compensation for Koike’s investment losses.

Fujikura, along with another managing director, were also charged last month in another payoff to Koike.

More than ten former and current executives of Japan’s Dai-Ichi Kangyo Bank also have been formerly charged with making illegal payoffs to Koike.

Update hourly