updated 01:40 pm EST, Fri November 18, 2011
New memo points to more unaccounted Olympus money
Japanese lawmakers and other officials are concerned the financial scandal at Olympus could be tied to the yakuza. A newly discovered memo acquired by the New York Times from Japan's Securities and Exchange Surveillance Commission, the Tokyo prosecutor's office, and the Tokyo Metropolitan Police Department shows that some $4.9 billion is unaccounted for, or much more than previously believed. Even the FBI is investigating the company after astronomical fees were paid to companies that have alleged links to organized crime.
When Michael Woodford, Olympus's ex-chief executive, was fired, he said the company was trying to silence him for asking public questions about the payments. Before this memo was unveiled, only about $1.4 billion in merger fees and acquisition payments was under scrutiny. The new number could make this the biggest potential scandal in Japan's recent memory.
The company's own internal investigation found that a number of money-losing acquisitions to hide investment losses in the '90s. Olympus denied earlier rumors that had it involved with Japan's yakuza in the alleged cover-up. The memo indicates Olympus paid much more than the losses it sought to hide.
Of the 481 billion yen (about $6.25 billion) paid for questionable acquisition payments, investments and advisory fees from 2000 to 2009, only about 105 billion yen was written down or otherwise accounted for in its books. The unaccounted for difference amounts to 376 billion yen, or $4.9 billion. The memo doesn't indicate whether Olympus knew about the crime links. If proven so, however, the association could delist Olympus shares from the Tokyo Stock Exchange, dealing a major blow to the company.
"Olympus was exploited over its cover-up totaling losses of 50 billion yen, and since 2000, over 200 billion yen has disappeared into the underground economy," the memo read.
On Thursday, Olympus officials had no comment.