OSAKA – Osaka Securities Exchange President Goro Tatsumi apologized to the bourse’s shareholders Wednesday over alleged market manipulation by a former OSE vice president.
Tatsumi offered the apology at the exchange’s annual shareholders’ meeting.
Prosecutors on Friday searched the OSE office and questioned former Vice President Takuo Noguchi, who allegedly falsified stock option deals between 1997 and 2000.
According to investigative sources, Noguchi has admitted to the allegations, claiming he wanted to activate the OSE market.
“I deeply apologize and hope we will have continued support from the shareholders so that we can prevent a repeat of such an act,” Tatsumi said.
The 20-minute meeting was low-key, with only 18 representatives from 14 companies present. The OSE had sent notices to its 94 shareholders, mostly local brokerages.
None of those present asked questions about the alleged fraud.
Outside the venue, about 60 members of the labor union at the OSE staged a demonstration to call for the immediate resignation of Tatsumi.
Noguchi is suspected of violating the market manipulation clause of the Securities and Exchange Law by organizing fake transactions between July 1997 and March 2000 to make OSE options trading appear to be drawing more participants than the Tokyo Stock Exchange.
The two markets started options trading of individual stocks simultaneously in 1997.
Market analysts voiced concern that the affair has damaged the OSE’s credibility and could cast a dark shadow on the exchange’s planned listing this fall on the Hercules market for startups.
The OSE became a stock company in 2001, switching from a membership entity.
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