Japan's Olympus sued by six banks over accounting fraud

Image source, AFP
Image caption,
The accounting fraud at Olympus was only discovered in 2011

Japan's Olympus faces lawsuits from six banks seeking compensation over false financial statements from 2000 to 2011.

The financial institutions are seeking a total of 28bn yen ($273m; £164m) in compensation.

Olympus was entangled in one of Japan's biggest accounting scandals, which came to light in October 2011.

That was when then chief executive Michael Woodford turned whistleblower and revealed investment losses which had been hidden for many years.

The six trust banks include Mitsubishi UFJ Trust and Banking, the Nomura Trust, and State Street Trust.

The accounting scandal was made public when Mr Woodford was dismissed from his post after challenging chairman Tsuyoshi Kikukawa and the board over suspiciously large payments related to acquisitions.

That led to an investigation being launched, which revealed a cover-up of losses dating back to the 1990s.

Mr Kikukawa, former executive vice-president Mr Mori and former auditing officer Mr Yamada were arrested in February 2012 and indicted on suspected violation of the Financial Instruments and Exchange Act. All three had admitted to hiding losses.

The scandal also hit Olympus shareholders, as the firm lost almost 80% of its value in the aftermath of the revelations.

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