An entrepreneur hailed as the poster boy for a new era of business in Japan has been indicted on charges of spreading false financial information in connection with one of his company's takeover targets. The founder of the Internet company Livedoor is the subject of a huge criminal investigation that has captivated Japan.
The first of what could be a number of indictments against Takafumi Horie has been handed up. The charges had been widely anticipated since Horie's arrest on January 23.
Horie and three other former executives of Livedoor are charged with releasing inflated financial figures of a firm that Livedoor took over in order to raise its stock price.
A prosecutors' statement in Tokyo said they would demonstrate that the key to the company's growth was a series of criminal acts.
The head of Livedoor's new management team, Kozo Hiramatsu, faced reporters and photographers after the announcement of the indictments.
Hiramatsu says he wants to apologize to shareholders and supporters of the company. He says the indictments are a grave situation for Livedoor, and he feels very sorry about the criminal charges.
Livedoor founder Horie, a pudgy 33-year-old who shunned suits and ties for jeans and T-shirts, became a hero to millions of young Japanese for bucking the complacent business system known as "Japan Inc." He became rich quickly by parlaying new enterprises into one of the country's most visible and dynamic entities.
But prosecutors allege that Horie's magic was really a criminal sleight-of-hand.
When Livedoor was first raided on January 16, it sent the Tokyo stock market into a spin. At one point, the volume of sell orders for Livedoor and other internet stocks was so large that the entire stock market had to be shut down.
News of the indictments sent Livedoor's stock price on the Tokyo exchange to its lowest level. Livedoor's market capitalization has withered to about $600 million from more than $7 billion at the time of the raid.