Olympus board sacks British company president and CEO

[hughster]

The word in some quarters here in Japan is that this is all a yakuza shakedown (not just the Gyrus, but the other three strange overpriced acquisitions). You mustn't think of these people as simply small-time pimps and drug dealers. They run hospitals, insurance companies, accountants and auditors, and are heavily involved in the stock market. A friend of mine who's an expert on these things (Jake Adelstein, who wrote "Tokyo Vice") describes them as "Goldman Sachs with guns" and estimates that they turn over about USD 50billion a year.

Quite frankly, it wouldn't surprise me if this were true - the gangs' reach spreads far and deep throughout all levels of Japanese society, from the top to the bottom. I don't believe, after more than 20 years living here, that this is simply a stock manipulation deal gone awry.

[Ian]

Originally Posted by hughster

The word in some quarters here in Japan is that this is all a yakuza shakedown (not just the Gyrus, but the other three strange overpriced acquisitions). You mustn't think of these people as simply small-time pimps and drug dealers. They run hospitals, insurance companies, accountants and auditors, and are heavily involved in the stock market. A friend of mine who's an expert on these things (Jake Adelstein, who wrote "Tokyo Vice") describes them as "Goldman Sachs with guns" and estimates that they turn over about USD 50billion a year.

Quite frankly, it wouldn't surprise me if this were true - the gangs' reach spreads far and deep throughout all levels of Japanese society, from the top to the bottom. I don't believe, after more than 20 years living here, that this is simply a stock manipulation deal gone awry.

This is quite credible and Woodford hinted as much. He was nervous about his safety after the board meeting that sacked him. But I can't see that this will save the current Olympus board. What was done was wrong and continues to be wrong and their current stance is making it even worse. And the UK authorities are obliged to investigate here as a UK subsidiary was involved in the payments.

Ian

[hughster]

Ian - not only wrong, but criminal. I have close contacts with the audit department of a Japanese bank, and one of their prime concerns is that organised crime members do not open bank accounts. It's tricky to catch, because identity theft is relatively easy here, but all banks have to show they're making some sort of effort to contain the plague. I have heard (with what justification, I don't know) that Kikugawa is a gambler (not a stock market type of gambler) - and his connections with unsavoury elements may be through that area. But that's only rumour as far as I know. Interestingly enough, NHK (equivalent of BBC) hasn't touched the story so far at all - this is relatively common, though - often Japanese scandals break overseas before the local media will mention them.

[whatapicture]

There was a small mention of the Olympus scandal in the financial section of the Mail on Sunday.

Pete

[hughster]

Japan Times has started to cover it, as have the Japan Bloomberg writers. It's made it into the Nikkei as well (English and Japanese editions). But I am sure that many Japanese are completely unaware of it, and will remain unaware until the British prosecutors start to move against Olympus UK, in which case the media here will probably scream "Persecution!". Sigh.

[EDIT]As a wonderful ironic aside, Kikugawa was due to speak at a Nikkei Economic Forum today on "Global Corporate Responsibility" - unsurprisingly, he didn't turn up to give his address.

[John Perriment]

Originally Posted by hughster

Ian - not only wrong, but criminal.

We must be careful, we don't know for sure yet. Wrong, almost certainly. Criminal, that first needs to be established by the investigating authorities and proven in a court of law. But I agree that all the indicators appear to be there. The sooner this matter is thoroughly investigated the better, both in the UK and Japan.

Meanwhile all the camera division can do is continue to develop, promote and sell their excellent products. All we as consumers can do is continue to buy, use, and enjoy our Olympus cameras and lenses.

[hughster]

Sorry, what I meant was "If Olympus have had dealings with the mob, that would be a criminal offence here in Japan". You are right, we don't know anything for sure. I am worried, though, that this will be swept under the carpet here, and that it will not be investigated - which will result in a loss of investor confidence in Japan as a whole. Right now, we (Japan) need an influx of money and confidence, and this is not the way to build trust. Only a full open investigation will lay the fears to rest.

And I agree - we can continue to enjoy the use of these wonderful products!

[Wee man]

Sunday times carried a write up also. Made interesting reading.

[Ian]

Update, Olympus Corp. Chairman, Tsuyoshi Kikukawa, who both appointed Michael Woodford to the positions of President and later CEO of Olympus and then sacked him after Woodford turned whistleblower, has today resigned, although he will continue as a non-executive director.

Ian