Accessibility links

Breaking News

Former Head of Seibu Conglomerate Arrested

The former head of a real estate, transportation and resort empire has been arrested. Yoshiaki Tsutsumi was taken into custody as investigators searched offices of his Seibu group, including headquarters of Kokudo, Seibu's unlisted parent company.

Prosecutors say they expect to charge Mr. Tsutsumi with falsifying statements on shareholdings and insider trading.

Local media reports say the former chairman of the conglomerate allegedly told executives to underreport equity stakes held in Seibu Railway by major shareholders, including a privately held firm that effectively controls the railway group.

Seibu Railway admitted last October its reports were false and Mr. Tsustumi resigned his posts. Two months later the company was de-listed from the Tokyo Stock Exchange.

Nobuo Yamaguchi, chairman of the Japan Chamber of Commerce and Industry, says Mr. Tsutsumi has become like the fabled "emperor with no clothes." Mr. Yamaguchi calls the former Seibu chairman's actions deplorable. He says Mr. Tsutsumi's underlings operated in an atmosphere of fear and the orders the boss gave them were inappropriate.

Mr. Tsutsumi, well connected to Japan's elite and powerful, ran the Seibu empire for 40 years, inheriting the post after his father, the group's founder, died in 1964. He was once considered the world's richest man, but his fortune has fallen since the Japanese economy began a long slump in the early 1990s. However, he still is worth about $3 billion.

In other business news, last October's killer earthquake in the Niigata region is hurting earnings at East Japan Railway. The company says the additional costs resulting from the quake, which derailed a bullet train, is forcing it to reduce its group net profit forecast to just above $1 billion from an earlier forecast of about $1.25 billion.

JR East, as the railway is commonly known, says it will spend about $250 million to restore damaged track, an electric power plant and other facilities in the quake-hit region.

Two of Japan's most influential business organizations are lobbying the government to move faster to open the country's job market to unskilled foreign laborers.

The Japanese Business Federation and the Japan Chamber of Commerce say while it is laudable the Justice Ministry is considering widening the job market for non-Japanese workers, it needs to speed the process and set a deadline.

The business groups specifically point out the need for nurses and other caregivers, saying the quota for such workers from the Philippines should be expanded under a free trade agreement between Tokyo and Manila.