Three executives of Japan's Olympus resigned today ahead of a boardroom showdown with ousted CEO Michael Woodford, as the British whistleblower said he would not be surprised if "some criminality" were involved in the scandal engulfing the once-venerable firm.
The camera and endoscope maker admitted this month it hid losses on securities investments for two decades, blaming former president and chairman Tsuyoshi Kikukawa, former vice-president Hisashi Mori and internal auditor Hideo Yamada for the cover-up.
But where the money trail leads remains a mystery, and speculation simmers that organised crime syndicates may somehow be involved.
Mr Kikukawa, who quit as president and chairman on October 26th, and Mr Mori, who was fired, had tendered their resignations from the board with immediate effect, as had Mr Yamada, who could attend board meetings but not vote, Olympus said in a statement.
And new president Shuichi Takayama said in a separate statement the current management team was ready to quit once "the path to Olympus' revival became clear".
Mr Woodford (51) who earlier met with Japanese police, prosecutors and regulators in Tokyo, expressed confidence that the authorities would fully investigate the scandal.
"The talks (with authorities) have passed all my expectations ... and it's very evident to me they are going to investigate this whole issue without bias and thoroughly, and that will include following the money flows in relation to all the transactions," he told reporters.
"I'm immensely encouraged. I've been treated with great courtesy and I'm much more confident than I thought I would be with what I've been told."
Olympus fired Mr Woodford on October 14th, asserting he did not understand Japanese culture or the firm's management style.
His return to Tokyo caps a remarkable turnaround for the Briton, who after being fired by the Olympus board was told his driver would no longer be available and that he should vacate his apartment. Someone Mr Woodford trusted suggested he leave Japan immediately for his own safety, which he did.
Mr Woodford fled to England and has campaigned for the firm to come clean. Big foreign shareholders have called for his return to run Olympus, which Mr Woodford has said he was willing to do.
Mr Woodford says Tokyo police, who have mobilised an organised crime unit to join the investigation, have a big role in uncovering the truth. The US Federal Bureau of Investigation and Britain's Serious Fraud Office are also investigating.
"The metropolitan police to me is the one that probably has the capability to investigate this in the right way," Mr Woodford told reporters yesterday after a low-key return to Tokyo for the first time since his sacking.
Mr Woodford is still an Olympus director since only shareholders can dismiss directors. Mr Woodford had refused to come back to Japan because of safety concerns but says he is now confident police will protect him.
The payments included a $687 million advisory fee paid mostly to an obscure Cayman Islands firm.
The panel is due to report its findings in early December.
Mr Woodford has called for a thorough investigation of the transactions and for a clean-out of top management.
But echoing calls by major foreign shareholders, Mr Woodford said Olympus shares should not be delisted, in part to help ensure full disclosure of information.
The Tokyo Stock Exchange has placed Olympus on a watch list as a prelude to possible delisting. If the firm fails to meet a December 14th deadline for filing its financial statements for the six months to September, it will be automatically delisted.
The bourse could delist the firm even if it meets the deadline, depending on the scale of past financial misstatements or if proof emerges that it knowingly dealt with "yakuza" gangsters. That would effectively cut it off from capital markets and put it under pressure to sell off core businesses.
A major governance advocacy group have also called for it not to be delisted. Olympus has said it would meet the December 14th deadline for filing its statements.
Reuters
