The head of Japan's Murakami Fund has been arrested just hours after he admitted to insider trading. This is the latest fallout from the Livedoor scandal that rocked Japanese markets earlier this year.
Investment fund mogul Yoshiaki Murakami on Monday admitted at a hastily convened news conference carried live on most television networks that he had violated insider-trading laws. He told reporters he was certain to be arrested and would step down immediately as head of the $3.5 billion Murakami Fund.
Murakami, bowing deeply, apologized for causing great trouble, saying he made a mistake and will accept the punishment. He said he would not return to the securities business.
Hours later his office and home were raided and Murakami was arrested.
The 46-year-old former Trade Ministry official has become a household name in Japan for his shareholder activism - a rarity here - and his aggressive style of capitalism.
Murakami contends he did not intend to break any laws when he bought shares in Nippon Broadcasting last year based on his advanced knowledge that Internet firm Livedoor was going to make a takeover bid.
Livedoor founder Takafumi Horie was arrested in January for breaking securities laws. News of the scandal caused the Tokyo stock market to close for the first time ever.
Japan's Financial Services Minister Kaoru Yosano on Monday lamented that both men, not long ago, were regarded as modern-day heroes. Yosano says Horie and Murakami, however, have violated securities laws, and he hopes they reflect seriously on their actions.
The two became symbols of a brash new approach to investment, but their tactics of launching corporate raids and demanding that companies in which they invested put more emphasis on profits alarmed Japan's traditional business leaders.
Prime Minister Junichiro Koizumi, who supported Horie's political aspirations last year, said on Monday he knew nothing of Murakami's business practices. The prime minister says all stock transactions should be conducted in a fair and trustworthy manner.