The former Olympus Chairman and CEO, Tsuyoshi Kikukawa, has “escaped” jail time after the judges have decided to hand him a suspended sentence for a $1.7 billion fraud.
Olympus has been rocked by a major scandal a couple of years ago when it has been discovered that the company’s CEO and Chairman has been forging earnings statements for several years.
Ex-Olympus CEO Tsuyoshi Kikukawa receives suspended sentence
A lawsuit quickly unfolded and Olympus had to pay a $7 million fine, while former CEO Tsuyoshi Kikukawa got a suspended sentence.
Beside Tsuyoshi Kikukawa, former executives Hisashi Mori and Hideo Yamada have also been involved in the suit and both of them have received suspended prison time.
Other executives implicated in the matter were the company’s two presidents at the time, Toshiro Shimoyama and Masatoshi Kishimoto.
Tokyo District Judge declined prosecutors’ request to put Olympus executives in jail
The case has been judged by Hiroaki Saito, who has decided that the defendants will not go to jail. The prosecutors are still claiming that the Olympus executives should have gone to jail and that the company should have received a higher fine.
CEO Tsuyoshi Kikukawa and Hideo Yamada have both received a three-year suspended jail time, while Hisashi Mori has got a suspended sentence of only two and a half years. Judge Saito ruled that the $7 million fine is enough.
Meanwhile, the Judge has been unable to “punish” presidents Shimoyama and Kishimoto due to the expiration of the statute of limitations.
Billion dollar fraud not enough to get former Olympus executives in prison
Evidence has demonstrated that the two presidents have been the masterminds behind the $1.7 billion fraud. It appears that they have been aware that investment losses would damage the company, so they have forged the financial statements.
Kikukawa and Yamada have taken over the job from the aforementioned pair, but they did not want to get their hands dirty, therefore they have instructed Mori to perform the falsifications. However, neither of them have had anything to gain personally, so the Judge spared them from jail time.
Olympus has suffered a major drop in reputation across the world, while its stock price plunged. Anyway, the company must put everything behind it now and focus on future products, such as the rumored OM-D E-M1.