Prosecutors on Friday reportedly questioned Livedoor Co.’s chief financial officer, Ryoji Miyauchi, director Fumito Kumagai and another executive over alleged violations of the Securities and Exchange Law, sources said.
Investigators questioned them on a voluntary basis in the latest development of the probe into whether Livedoor misled the stock market in 2004 over one of its many merger-and-acquisition deals in order to boost the share price of an advertising subsidiary, Livedoor Marketing Co., then known as ValueClick Japan Inc., the sources said.
They were also questioned about allegations that Livedoor falsified its financial report for the year through September 2004 to make it appear that it had a profit of 1.4 billion yen when it was in fact in the red, the sources said.
Through questioning the executives, prosecutors hope to determine whether there was any involvement by Livedoor President Takafumi Horie.
On Friday, newspapers reported that prosecutors believe Livedoor mishandled more acquisitions than they initially suspected as they stepped up their investigation.
Miyauchi, 38, is a licensed tax accountant who has been a board member of Livedoor since 1999. He worked for Livedoor’s business expansion mainly in its finances. Regarding the stock transactions following ValueClick’s takeover of a publishing company, Miyauchi recently said he led the deal.
Kumagai, 28, joined Livedoor in 2002 after working for a brokerage, playing leading roles in its M&A deals. He led Livedoor’s high-profile bid last year to take control of Nippon Broadcasting System Inc., a radio broadcaster belonging to the Fujisankei Communications Group.
Prosecutors also learned that a chartered accountant who audited Livedoor’s accounting served as a representative executive of a Livedoor-affiliated consulting firm, according to the investigative sources.
While Livedoor is alleged to have committed accounting fraud, investigators are probing if the company and the accountant conspired to falsify financial reports, the sources said.
Prosecutors investigating alleged accounting violations by Livedoor Co. have found that a large number of e-mail messages were deleted, indicating the possibility that the Internet services firm tried to destroy evidence, sources said.
The Tokyo District Public Prosecutor’s Office has been analyzing about 100,000 e-mail messages since Monday night, when it confiscated about 100 computers from Livedoor’s headquarters in Minato Ward, Tokyo, and its affiliate in Shinjuku Ward where its network server is located.
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