Business

Olympus pays US investors RM8.4 million over accounting scandal

Japanese camera giant Olympus said today it has agreed to pay US$2.6 million (RM8.4 million) to settle a US investor lawsuit stemming from a huge accounting scandal that hammered its shares.

The claim was filed two years ago by an investor who claimed that a loss cover-up by Olympus executives was responsible for its plunging stock price.

The scandal also battered the country's corporate governance image, and sparked probes by regulators in Japan, Britain and The United States.

Olympus stock dived in the wake of the scandal, but is now about 25% higher than before the loss cover-up was exposed. The firm's Tokyo-listed shares closed 1.60% lower to 3,060 yen (RM99.87) yesterday.

The US investors who sued the company bought American Depositary Receipts, which hold shares in a foreign company but are priced in US dollars.

Olympus said today it was embroiled in about 20 other lawsuits in Japan and overseas that had yet to be settled.

The company reportedly agreed to pay its whistleblowing chief Michael Woodford £10 million (RM51.8 million) in a wrongful-dismissal lawsuit.

Woodford, the company's first foreign leader, exposed the scheme in late 2011 after he was sacked for questioning the firm's past conduct.

Earlier this month, Britain's Serious Fraud Office said it would prosecute Olympus and a subsidiary over the huge loss cover-up scandal.

In July, a Japanese court handed suspended jail sentences to three former Olympus executives for engineering the scheme to hide about US$1.7 billion in losses that had accumulated since the 1990s by using outsized consulting fees and buying unrelated companies.

The firm has also been slapped with millions of dollars in penalties issued by the courts and regulators.

Olympus has since undergone a major overhaul that included cutting about seven per cent of its workforce and forging a capital tie-up with electronics giant Sony, which is seeking to tap the lucrative medical equipment market.

Although better known as a camera maker, Olympus is a world leader in medical endoscopes. - AFP, September 27, 2013.

Comments