Prosecutors Allege Sanwa Bank Aided Stock Manipulation
Prosecutors today linked a second major Japanese bank, Tokyo-based Sanwa Bank, to a growing stock manipulation scandal.
In a hearing before the Tokyo District Court, prosecutors charged stock speculator Mitsuhiro Kotani and a longtime associate with conspiring to manipulate the share prices of a large resort development firm in April.
They also alleged that Sanwa Bank provided Kotani and associates with $238.5 million that was used to manipulate the share prices, according to a transcript of the prosecution’s argument published in newspapers.
Last Sunday, the chairman of Sumitomo Bank, Ichiro Isoda, resigned after a manager at one of Sumitomo’s branches was linked to Kotani’s stock activities in the latest scandal to rock Japan.
Kotani pleaded not guilty today to charges of manipulating the share prices of Fujita Tourist Enterprises, a major hotel developer listed on the Tokyo Stock Exchange.
The other suspect indicted in the case, Shuichi Yamamoto, 50, head of the small construction firm Joko Co., also entered a not-guilty plea.
The prosecution told the court that Kotani, Yamamoto, officials of the construction firm Tobishima Corp. and Fujita Tourist had cooperated to drive up the price of Fujita shares in May, 1989.
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