The governing Liberal Democratic Party will propose a bill to impose surcharges on companies falsifying their financial statements, members of an LDP panel on corporate accounting said Friday.

Falsified financial statements of Seibu Railway Co. that surfaced last year have sparked doubt about the reliability of corporate information disclosure, the panel members said.

Former Kokudo Corp. Chairman Yoshiaki Tsutsumi was arrested Thursday for his alleged involvement in falsifying financial statements at Seibu Railway.

The Financial Services Agency earlier tried to include such a surcharge in a bill to revise the Securities and Exchange Law for submission to the Diet during the current session.

But the FSA abandoned the idea after the Cabinet Legislation Bureau complained that standards for calculating such surcharges were too vague.

LDP’s corporate accounting panel, led by Yasuhisa Shiozaki, intends to build on the original FSA plan in developing the surcharge bill, the panel members said.

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