The disgraced former president of Internet startup Livedoor Co. and three other former executives will be indicted Monday on charges of violating securities laws, news reports said Saturday. Prosecutors will also serve new arrest warrants to the former president, Takafumi Horie, and others to enable prosecutors to hold them for further questioning because the current detention period expires Monday, Kyodo News reported citing prosecution sources.
The indictments will cover allegations that the officials padded the parent company's profits for the business year through September 2004, Kyodo News, the Nihon Keizai Shimbun and public broadcaster NHK said.
Prosecutors were unavailable for comment late Saturday.
On Friday, Japan's securities watchdog said it filed criminal complaints against Livedoor Co., Horie and three other former executives on suspicion of releasing false information during the takeover of Money Life by subsidiary Livedoor Marketing in 2004.
Livedoor Marketing, then known as ValueClick Japan Inc., also allegedly falsified revenue statements in the third quarter ending in December 2004 to make it appear that operating and net losses were in the black, according to a statement released Friday by the Securities and Exchange Surveillance Commission.
The watchdog was also investigating Livedoor's firms and managers for alleged insider trading, money laundering, and false financial reporting. Investigators were cooperating with authorities overseas to look into alleged illegal activity by the company in the Virgin Islands and elsewhere, the SESC said without elaborating.
The complaints follow the Jan. 16 raid of Livedoor's Tokyo offices and the arrests of Horie and four Livedoor executives. The highly publicized investigation sent shares plunging in Tokyo last month as jittery investors sold off technology and other stocks, though the Nikkei 225 index has since recouped its losses.
The probe also sent Livedoor subsidiaries scrambling to disassociate themselves from the disgraced startup, which had bought up companies by the dozens since it was founded in 1997.
Horie has denied any wrongdoing and Livedoor said in a statement Friday that the company will cooperate with the investigation and strengthen its internal management structure. The three other executives have admitted to the charges, Kyodo said, citing its sources, reports the AP.
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