A high-profile fund manager was found guilty of insider trading yesterday and sentenced to two years in prison in a case that underlines Japan's struggles to regulate takeovers and startups.
Presiding Judge Kunihiko Koma also hit Yoshiaki Murakami, former head of MAC Asset Management, with record fines and penalties totaling ¥1.4 billion (US$11.5 million).
Koma said Murakami's crime was an abuse of his profession as fund manager, deserving a prison term that is relatively rare here for white-collar crimes.
In a ruling read out for about two hours, Koma said Murakami made dubious money by influencing a startup founder to buy shares in radio broadcaster Nippon Broadcasting, scheming to make money over a takeover attempt that was certain to follow.
Murakami, 47, who had pleaded innocent, appealed the verdict within an hour of the session's closing, the Tokyo District Court said.
The trial marked a downfall for a bureaucrat-turned-entrepreneur who had at one point been viewed as a new breed of aggressive investor that is openly defiant toward more old-fashioned business practices.
Japan is still grappling with policing takeovers, and companies have recently started to come up with takeover defense measures. Rules for takeovers and stock trading aren't as clearly defined in a corporate culture that was dominated by networking among established companies. Japan has long tended to frown upon get-rich-quick schemes, fostering docile conformist salarymen.
Prosecutors had demanded three years in prison and a fine of more than ¥1 billion, alleging Murakami violated securities laws in buying up a large stake in Nippon Broadcasting Systems Inc after he knew startup Livedoor Co was planning to take over the radio broadcaster.
Murakami has acknowledged talking with Livedoor founder and chief executive Takafumi Horie, who was found guilty of securities laws violations in a separate trial. But Murakami denied he bought Nippon Broadcasting shares with knowledge of Livedoor's intentions, and has argued he never thought Livedoor was serious about a takeover.
Horie, who was also a media idol before his arrest last year, was convicted in March of securities laws violations in falsifying earnings and sentenced to two-and-a-half years in prison -- in what some saw as unusually harsh punishment here for a white-collar crime. He has asserted his innocence and is appealing the verdict.
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