According to a Kyodo news agency report on Sunday, Japanese prosecutors are considering indicting Olympus Corp as a company. Last Monday the company, who is allegedly involved in a $1.7 billion scandal to falsify its financial reports to conceal huge investment losses, forecast a $410 million full-year loss due largely to its ailing camera operations.
Olympus revealed a $1.1 billion dent in its balance sheet in December when it filed five years’ worth of corrected financial statements plus overdue first-half results.
The scandal was first exposed last October by former chief executive Michael Woodford. After querying dubious deals allegedly used to conceal the losses, Woodford was soon sacked by the Olympus board. He has since given up trying to get his job back blaming cozy ties between management and big Japanese shareholders.
Following the Tokyo Stock Exchange’s decision last month to keep Olympus listed, the Tokyo District Public Prosecutors and the watchdog Securities and Exchange Surveillance Commission (SESC) have determined they can make a case, Kyodo said.
Olympus is likely to be indicted as a corporation as prosecutors charged chairman and president Tsuyoshi Kikukawa, and six other people last week. The company would face up to 700 million yen ($8.82 million) in penalties if found guilty, Kyodo said.