• Kyodo

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A former managing director of Microsoft Co., the Japanese subsidiary of Microsoft Corp., was handed a suspended two-year prison term Wednesday for income tax evasion.

The Nagano District Court also ordered Shinji Tokutake, 51, to pay 70 million yen in fines.

The court ruled that Tokutake evaded about 294 million yen by hiding 836 million yen in income from stock-option profits in 1999 and 2000.

Tokutake purchased the options from the U.S. parent firm in 1998 and tried to conceal the profits by changing his address from Tokyo to Nagano.

He thought changing tax authority offices would make it easier to hide his income, according to the court.

Prosecutors demanded a two-year prison term and 90 million yen in fines for Tokutake, who left Microsoft in October. His sentence was suspended for three years.

Another former managing director of Microsoft Co. has been indicted on a similar charge in Shizuoka Prefecture.

Holders of stock options have the right to buy or sell stock at a specified price within a specific period.

Japan lifted restrictions on stock options in a June 1997 amendment to the Commercial Code.

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