Police on Thursday arrested four former executives of the failed credit union Eitai who allegedly had their firm take over 7.8 billion yen in bad loans extended by an affiliated company to ailing borrowers, even though they knew the loans were unrecoverable.
Arrested were former credit union chief Yukio Yamaya, 54; a former managing director, Kazuharu Minematsu, 65; former finance department chief Saburo Nakagawa, 67; and Yasunori Yoshizawa, 67, president of the affiliated firm.
According to police, the affiliated firm, a mortgage securities company, fell on tough times in the 1990s following the burst of the bubble economy, and it had been urged to pay back its loans to major banks.