Press Conference by KATO Katsunobu, Minister of Finance and Minister of State for Financial Services

(Excerpt)

(Tuesday, March 25, 2025, 9:47 am to 9:52 am)

[Opening remarks:]

Minister)

As already announced yesterday, the Financial Services Agengy (FSA) issued business improvement orders to four companies, Tokio Marine & Nichido Fire Insurance, Aioi Nissay Dowa Insurance, Sompo Japan Insurance, and Mitsui Sumitomo Insurance based on the Insurance Business Act regarding the information leakage case. The details were announced yesterday, but it is deeply regrettable that such a situation has occurred.
The FSA strongly urges each company to take this business improvement order seriously and make drastic improvements to its legal compliance system.

[Questions and answers:]

Q.

On the 24th, the Securities and Exchange Surveillance Commission announced that it had filed a complaint against a former general manager of Sumitomo Mitsui Trust Bank on suspicion of insider trading. Following the cases of the employees of the Tokyo Stock Exchange and the FSA, this case is also a case of insider trading based on information learned through business. I would like to ask you what you think about the continuation of scandals involving such persons who should have high morals, and what measures you would like financial institutions to take to prevent recurrence.

A.

First of all, I am aware that the Securities and Exchange Surveillance Commission filed a complaint with the Tokyo District Public Prosecutors Office against a former employee of Sumitomo Mitsui Trust Bank regarding the insider trading case.
It is deeply regrettable that a former employee of the Bank has been charged with insider trading by the Securities and Exchange Surveillance Commission, which has shaken the credibility of Japan's financial markets and of financial institutions. In order to prevent such a case from recurring, I believe it is important to thoroughly investigate the cause and implement effective preventive measures.
Yesterday, the FSA issued a request for a report to Sumitomo Mitsui Trust Bank based on the Banking Act, requesting a report on the analysis of the causes of this case, measures to prevent recurrence, etc. The FSA will closely monitor the situation to ensure that the Bank can take appropriate measures.

Q.

Regarding the information leakage case mentioned earlier, I think that some of the companies that received the business improvement order have already conducted their own investigations, formulated measures to prevent recurrence, and reported them to the FSA. Does the fact that you requested the submission of the improvement plan again mean that the existing measures were insufficient?

A.

First of all, the FSA issued requests for reports to the four companies in July last year, and since then we have been carefully investigating the relationship between the cases, the causes of occurrence, etc. As a result, it was confirmed that all four companies had engaged in a number of inappropriate acts in light of the intent of the Act on the Protection of Personal Information and the Unfair Competition Prevention Act, that their systems for compliance with laws and regulations and for managing customer information were inadequate, and that they needed to strengthen their management systems. As mentioned earlier, this situation is deeply regrettable, so the FSA has issued a business improvement order to each company.
The FSA will continue to urge them to make fundamental improvements to their compliance systems.