Related topics

Sumitomo Considering Lawsuit Against Copper Trader

June 21, 1996

TOKYO (AP) _ Sumitomo Corp. is considering a lawsuit against the former trader it blames for losing $1.8 billion in unauthorized copper trades, a company spokesman said Friday.

The giant trading house is investigating the trades, which spanned a decade, and is looking into whether it can take legal action against Yasuo Hamanaka, Sumitomo spokesman Yoshinao Nemoto said.

Kyodo News reported the company could sue Hamanaka for breach of trust, but Nemoto could not confirm that. He said there are no definite plans yet to pursue a case against Hamanaka.

Sumitomo announced the massive losses last week, blaming them on Hamanaka and saying he acted alone.

Hamanaka, once considered a star at Sumitomo, was fired and has dropped out of sight, but he is not a fugitive. He has not been accused of any crime, and there are no major investigations of Hamanaka’s trades being carried out by Japanese authorities.

The company itself could be the target of a lawsuit from a group of stockholders that intends to sue Sumitomo for the money it lost.

Sumitomo will create a special reserve of $1.4 billion to cope with the losses. The company said when it announced the losses that the amount could easily be absorbed because of its large financial reserves.

Update hourly