The chief lawyer for Takafumi Horie, on trial on charges of inflating the earnings of Internet services company Livedoor Co., is accusing prosecutors of framing his client.
Using unusually strong language Wednesday, Yasuyuki Takai said the case against the former Livedoor chief executive is weak and has little substantive evidence.
Horie’s trial, which opened Monday, has riveted Japan. Horie, a glamorous dot-com idol before his January arrest, was praised as the face of a new Japan Inc. and a symbol of change toward a modern, freewheeling economy.
The court battle is also unusual because Horie has pleaded not guilty. In Japan, executives charged with white-collar crimes are considered as good as convicted and generally plead guilty to lighten their fines or avoid jail time, Takai said.
“But that wouldn’t be a true trial,” Takai said in an interview at his office in Tokyo. He said traditional customs and expectations often defy true justice.
“In Japanese culture, there’s praise for the chief executive who pleads guilty as gracefully taking blame and responsibility, even if he hasn’t done anything wrong.”
With no jury system, Horie has proven to be a maverick, opting to argue his case despite the risk of getting a heavier sentence, Takai said.
If deemed guilty by the judges, Horie faces a maximum penalty of five years in prison and 5 million yen in fines. But even a short jail term would be seen as a stiff penalty for doctoring earnings, Takai said.
Prosecutors have outlined a complex scheme in which Livedoor executives allegedly used dummy companies to buy its own stock and that of subsidiaries to inflate profits, all under Horie’s instructions.
But Takai noted that witnesses acknowledged during cross-examination this week that some of the money was deposited into personal accounts unrelated to Horie, which he said shows that Horie didn’t order the dealings as prosecutors claim.
“This is a frameup,” the former prosecutor said.
Testimony given so far has not revealed any direct links between the dealings and Horie.
Two fund managers who have taken the stand have repeatedly said they acted under orders from Hideaki Noguchi, who was the head a finance unit owned by Livedoor. Noguchi was found dead in an Okinawa hotel in January in what police say was a suicide.
Takai acknowledged that Livedoor may have made minor accounting errors, but said they should have been rectified with a reprimand from securities authorities, not a raid by prosecutors.
A not-guilty verdict in Horie’s trial would be a landmark for Japan’s legal system, he said. Less than 1 percent of the district court criminal trials end with not guilty verdicts.
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