Index Corporation’s former chairman Masami Ochiai, his wife, and the company’s president Yoshimi Ochiai have been arrested on suspicion of fraud. According to Japanese business publication, The Nikkei, all three were arrested today, May 28, by the Tokyo District Public Prosecutors Office on charges related to the company’s collapse. Investigations into the company’s dealings are currently under way and particularly concern falsified profit inflation within the business quarter ending August 2012.
Last year, Index Corporation filed for bankruptcy and was subsequently bought by Sega Sammy for 14 billion yen. Sega then split Atlus’ former parent company into two sections, mainly to focus on business growth but keeping game development intact. But Index Corporation’s fraudulent management dealings were not made clear until an investigation was opened. A snippet of the translated report can be found below, or in full, here.
There is a high probability that [Index Corporation’s] round-tripping antics were as such done in an attempt to avoid having the company delisted from JASDAQ [the Japanese equivalent to stock exchanges such as NASDAQ in the United States and Euronext in the European Union].
Investigators are continuing their inquiries under the suspicion that the series of fraudulent dealings were headed by Index’s management and that their window-dressing was performed systematically. When asked about Nikkei’s findings thus far, Masami Ochiai denied them, asserting that he had “not been engaging in fraud.” He has also stated the same thing to the governmental oversight committee during hearings conducted on the matter.