The chairman and president of Nikko Securities Co. resigned along with six other executives Oct. 3 to take responsibility for the firm’s involvement in a payoff scandal, completing a sweep of the Big Four brokerages humiliated by a “sokaiya” corporate racketeer.Chairman Takuya Iwasaki and President Kichiro Takao stepped down with six other board members, relinquishing their posts to Managing Director Hajime Imada and Vice President Masashi Kaneko, respectively.Speaking at a news conference, Takao said he was deeply sorry that the scandal, in which the nation’s top four brokerages allegedly paid millions of yen in loss compensation to the racketeer, has destroyed public trust in the fairness of Japan’s financial markets. He added that he was ashamed such a situation could have arisen after the firm was found to be involved in another wide-reaching loss compensation scandal in 1991.Although all the board members share responsibility, newly appointed president Kaneko was largely involved in international affairs at the brokerage and could not be directly linked to the current fiasco, Takao said. “Regaining trust is my top priority, and I want to bring the firm in line with global standards — there can be no shortcuts to Nikko’s rebirth,” Kaneko said.He pointed out that the personnel changes also put British national Michel de Carvalho, the joint chairman of Nikko Europe PLC., in charge of the company’s international affairs and overseas corporate affairs. Kaneko said he would like to see Carvalho eventually become a board member. But both the newly selected and outgoing officials refused to comment on details of the ongoing investigation, including whether Takao had ever met the sokaiya named in the case — Ryuichi Koike.
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