Japan Penalizes Daiwa Securities for False Reports
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TOKYO — The Finance Ministry sent a clear warning to Japan’s freewheeling securities industry today when it punished the nation’s No. 2 broker for filing false reports.
The ministry ordered Daiwa Securities not to raise funds for itself in the market for the time being as punishment for the reports, which hid stock-dealing losses, a ministry official said.
The ministry also asked Daiwa’s investment service division, responsible for the reports, to voluntarily refrain from business for two days, he said.
Industry analysts said that although the punishment was considered lenient, the ministry went one step beyond its usual slap on the wrist.
The Daiwa division at the center of the scandal was reported in the Japanese media of having tried to boost stock sales to corporate customers by guaranteeing against losses on their investments.
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