Tax Accountant Played Major Role in Livedoor Fraud Scheme
Posted on: Monday, 30 January 2006, 12:00 CST
By Kyodo News International, Tokyo
Jan. 30--TOKYO -- A Livedoor Co. tax accountant played a major role in the company's alleged accounting frauds in 2004 that aimed to boost its group's share prices, sources close to the Internet and financial services firm's accounting practices said Monday.
The accountant has been serving in an executive officer capacity at Livedoor. Prosecutors have already questioned her as they are probing the group's alleged securities law violations by misleading investors with false information, prosecution sources said.
The prosecutors suspect Livedoor falsified its financial records for the year through September 2004, booking 1.4 billion yen in profit rather than a 1 billion yen loss.
The suspected manipulation is believed to have been carried out by transferring part of Livedoor affiliates' profits to the parent company.
The prosecutors also suspect all instructions for cooking the books came from former Livedoor Chief Financial Officer Ryoji Miyauchi via e-mails.
Miyauchi was arrested Jan. 23 with three other executives, including former Livedoor President Takafumi Horie. Horie, Miyauchi and others stepped down from Livedoor executive posts after the arrests.
Miyauchi has admitted to the accounting frauds, according to the prosecution sources, who quoted him as saying that he "wanted to prevent share prices from falling." Livedoor had forecast a 13 billion yen profit for the September 2004 business year.
Prosecutors also allege Horie was well informed of the fraud scheme.
Under part of the scheme, Livedoor is believed to have booked transfers of more than 1.1 billion yen from two companies as its sales, despite the fact that the two were about to be acquired by Livedoor.
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Source: Kyodo News International, Tokyo
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