Did Olympus pay gangsters to gloss over the billions it lost?
Japanese officials say that at least $4.9 billion is unaccounted for in a financial scandal at Olympus and are investigating whether much of that money went to companies with links to organised crime.business Updated: Nov 18, 2011 22:38 IST
Japanese officials say that at least $4.9 billion is unaccounted for in a financial scandal at Olympus and are investigating whether much of that money went to companies with links to organised crime.
In a memo prepared by investigators and circulated at a recent meeting of officials from Japan's Securities and Exchange Surveillance Commission, the Tokyo prosecutor's office and the Tokyo Metropolitan Police Department, officials say they are trying to determine whether Olympus worked with organised crime syndicates to obscure billions of dollars in past investment losses and then paid them exorbitant sums for their services.
The memo - a copy of which was obtained by The New York Times from a person close to the official investigation - appears to link the Olympus losses for the first time to organised crime groups. It also suggests that investigators believe illicit payouts from Olympus went far beyond the roughly $1.4 billion in merger fees and acquisition payments that have come under recent scrutiny, potentially making it one of the biggest scandals in Japanese corporate history.
Olympus, a maker of medical imaging systems and digital cameras, recently announced that an internal investigation had found that the company used a series of money-losing acquisitions to hide investment losses in the 1990s, keeping those losses off its books for decades.
It has denied rumours that it sought the aid of Japan's notorious organised crime syndicates, known as the yakuza, to help orchestrate a cover-up.
Olympus paid a total of 481 billion yen, or $6.25 billion, through questionable acquisition payments, investments and advisory fees from 2000 to 2009, according to the memo, but only 105 billion yen has been written down or otherwise accounted for in its financial statements. That leaves 376 billion yen, or $4.9 billion, unaccounted for, according to the memo.