Japanese police yesterday arrested the head of an asset management company at the center of a scandal that saw the loss of almost US$1.4 billion in pension fund money.
Tokyo Metropolitan Police said it held AIJ Investment Advisers president Kazuhiko Asakawa, 60, and three of his associates on suspicion of swindling ￥7 billion (US$88.6 million) from two retirement funds.
However, the firm’s total losses are said to top ￥109 billion.
The three men and a woman “conspired to defraud cash in the name of pension fund management” and lied in June and July last year by saying the retirement assets had steadily risen in value when, in reality, they had tumbled, a police spokesman said.
Earlier yesterday, authorities reportedly raided the company’s Tokyo headquarters while questioning Asakawa, who has publicly admitted he inflated investment returns, but denied that he tried to deceive clients.
“I didn’t want to use inflated figures for the pensions fund, but [I did because] I did not want to come back with losses, no matter what,” he told a parliamentary panel investigating the matter earlier this year. “I was confident of recouping the losses.”
AIJ’s operations were suspended in February in a scandal that has rocked Japan.
The Securities and Exchange Surveillance Commission has said AIJ, which managed ￥145 billion in retirement funds, lost at least ￥109.0 billion in an alleged fraud that reportedly affects more than 880,000 policy holders.