Japan Press Weekly

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2007 March 14 - 20 [SOCIAL ISSUES]

Former Livedoor president Horie gets prison sentence

The Tokyo District Court on March 16 sentenced Horie Takafumi, the former president of the Internet firm Livedoor, to two years and six months in prison for his role in the company’s securities fraud.

In the ruling, presiding Judge Kosaka Toshiyuki pointed out that Livedoor’s window-dressing undermined fair competition in the stock market, and said, “[Horie] has sought to maximize only his company’s profit at the cost of investors by using deceptive means.”

The trial focused on whether Horie had the real power to commit the fraud and whether he had played the main role, in addition to such questions as whether it was legitimate for Livedoor to incorporate as sales in its consolidated account the profit that an investment fund it had set up made by selling shares of the company.

Deciding that former Livedoor executives’ testimonies were trustworthy, the ruling said, “The fraud would not have been possible if it had not been for [Horie’s] instruction or approval.”

　 In a published comment on the same day, Sasaki Kensho, Japanese Communist Party House of Representatives member who heads the JCP task force for exposing plutocracy and political corruption, stated, “Livedoor repeatedly made large profits through stock speculations at the cost of general shareholders. The court ruling criticized such alchemy and money games.”

“At the same time, the ruling Liberal Democratic Party must be held responsible for enabling Livedoor to engage in such alchemy and for making use of Horie in promoting LDP policies by praising him as a flag-bearer of reform,” Sasaki said.

Prime Minister Abe Shinzo was the LDP’s then acting general secretary when he said, “Mr. Horie’s success in his business is a product of the structural reform policy of Mr. Koizumi (then prime minister) and of the measures to ease regulations” on a TBS TV program aired on August 17, 2005.