Daiwa eyes exec pay cuts over insider info

Kyodo

Daiwa Securities Group Inc. plans to cut the pay of executives, including President Takashi Hibino, in connection with the leak of insider information by a former official of its subsidiary, Daiwa Securities Capital Markets Co., sources said.

Daiwa Securities Group will announce the pay cuts Friday together with the findings of an investigative panel of outside experts it established in early July, the sources said Wednesday.

A marketing official of the subsidiary, now called Daiwa Securities Co., informed investment advisory firm Japan Advisory Ltd. of a share offering by Nippon Sheet Glass Co. in 2010 before its announcement.

Japan Advisory had its business registration revoked by the Financial Services Agency in June.

According to a senior FSA official, Japan Advisory increased orders to securities companies in exchange for insider information.

The financial industry watchdog, which is cracking down on insider trading, has instructed 12 securities companies to submit reports on their deals with Japan Advisory by Aug. 3.

Daiwa Securities Group is expected Friday to announce a set of measures to prevent a recurrence, including seminars to enhance employees’ legal compliance and a reinforced information management system.