Japanese artificial intelligence developer Alt, which revealed accounting irregularities recently, has filed for bankruptcy protection with the Tokyo District Court under the civil rehabilitation law.
The court accepted the application, according to the Tokyo-based company's announcement Wednesday. Alt left debts totaling about ¥2.4 billion ($16.1 million) and aims for its rehabilitation by finding a sponsor entity that will take over its operations. Alt's line of business includes a service to create meeting summaries using AI.
The company went public on the Tokyo Stock Exchange's Growth section for startups in October 2024, 10 years after its establishment in 2014.
However, suspicions of accounting fraud surfaced at the company in April this year.
On Monday, Alt said in an investigation report that the company padded its sales in the four years through December 2024 by a total of ¥11.9 billion. The firm's founder, Kazutaka Yonekura, resigned as its president the same day.
A third-party panel's investigation has found that Alt also falsified documents it submitted to the TSE for the exchange's examination of its stock listing application.
On Wednesday, the TSE decided to delist Alt on Aug. 31.
At a press conference Wednesday, Hiromi Yamaji, group CEO of Japan Exchange Group, the operator of the TSE, harshly criticized the series of wrongdoing by Alt.
The irregularities are "very regrettable as they shaken the credibility of the initial public offering and audit systems," Yamaji said.
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