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Former Olympus Executives Plead Guilty to Carrying Out Massive Financial Fraud

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It looks like the Olympus financial scandal is finally coming to an end. It has been nearly a year since it came to light that there were massive cases of fraud and coverups going on in the upper echelons of Olympus management. What started as a CEO’s firing quickly spiraled into one of the biggest scandals to ever hit corporate Japan — the country’s equivalent of the US’ Enron fiasco.

In the end, a number of the company’s top executives were arrested after submitting their resignations. The trials for those former bigwigs are only now starting to get underway. Three of them, including former chairman Tsuyoshi Kikukawa (pictured above), pleaded guilty today to charges of falsifying accounts and covering up more than $1 billion in losses. The camera company itself also filed a guilty plea.

In his statements to the Tokyo District Court, Kikukawa assumed full responsibility and apologized for his actions. He is quoted as saying,

The full responsibility lies with me and I feel deeply sorry for causing trouble to our business partners, shareholders and the wider public. I take full responsibility for what happened.

If found guilty, each of the accused faces up to ten years in jail and fines of up to ~$128,000. Olympus itself may be fined more than ten times that amount, and may still face a barrage of lawsuits from businesses and individuals that experienced heavy losses through the ordeal.

The financial impact of this scandal, coupled with the less-than-ideal performance of its camera business, is forcing Olympus to look for external help. According to Reuters, that help will soon come from camera industry rival Sony, which will reportedly pump $642 million into the Olympus in exchange for a 10% stake. After the deal, Sony will become the largest shareholder in Olympus — a crazy thought, given the fact that they’re currently competing against one another for mirrorless camera dominance.

(via Reuters)

Image credit: Photograph by United Nations Development Programme

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