June 19, 2012
TOKYO (AFP) - Japanese police on Tuesday arrested the head of an asset management company at the centre of scandal that allegedly saw the loss of almost $1.4 billion in pension fund money, a report said.
Tokyo Metropolitan Police held Kazuhiko Asakawa, 60, president of AIJ Investment Advisers, on suspicion of swindling investors out of at least 7.0 billion yen, Japan's public broadcaster NHK reported, but the firm's total losses are said to top 109.0 billion yen ($1.38 billion).
Police also arrested two other officials from AIJ and one of its affiliates, NHK added but the report could not be immediately confirmed.
Earlier Tuesday, police reportedly raided the company's Tokyo headquarters while questioning Asakawa, who has publicly admitted that he inflated investment returns but denied that he tried to deceive clients.
"I didn't want to use inflated figures for the pensions fund, but (I did because) I did not want to come back with losses, no matter what," he told a parliamentary panel investigating the matter earlier this year.
"I was confident of recouping the losses."
AIJ's operations were suspended in February in a scandal that has rocked Japan where a rapidly ageing population is increasingly looking to private pension funds to help them through their retirement years.
The Securities and Exchange Surveillance Commission has said AIJ, which managed about 145 billion yen in retirement funds, lost at least 109.0 billion yen in an alleged fraud that reportedly may affect more than 880,000 policy holders.
Earlier reports have said AIJ boasted it was posting annual returns of up to 240 percent in a market where many investment funds were struggling to keep their heads above water.
