SESC Latest Topics No.31«December 2016»

Last Updated : December 22, 2016

Recommendation for an administrative action against AM Online Co., Ltd.

«Summary»

The SESC recommended that the prime minister and the commissioner of the FSA take an administrative action against AM Online Co., Ltd. (hereinafter “the Company”), an Investment Advisor/Agency.

Based on an inspection of the Company, the SESC identified that the Company had (i) made false statements to customers in relation to the conclusion of financial instrument transaction contracts and their solicitation, (ii) provided customers with conclusive evaluations on uncertain matters, thereby soliciting them to conclude financial instrument transaction contracts and (iii) made advertisements that are seriously misleading investors.

Recommendation for an administrative action against Asset-Creation Co., Ltd.

«Summary»

The SESC recommended that the prime minister and the commissioner of the FSA take an administrative action against Asset-Creation Co., Ltd. (hereinafter “the Company”), a Specially Permitted Business Notifying Person.

This recommendation is based on the findings of an inspection of the Company, whereby the director-general of the Kanto Local Finance Bureau identified that the Company had (i) engaged in investment management business without statutory registration and (ii) had problems concerning investor protection in its business operations.

Recommendation for an administrative action against AJ ASSET CREATION Co., Ltd.

«Summary»

The SESC recommended that the prime minister and the commissioner of the FSA take an administrative action against AJ ASSET CREATION Co., Ltd. (hereinafter “the Company”), a Specially Permitted Business Notifying Person.

This recommendation is based on the findings of an inspection of the Company, whereby the director-general of the Kanto Local Finance Bureau identified that the Company had (i) engaged in investment management business without statutory registration and (ii) had problems concerning investor protection in its business operations.

Recommendation for an administrative action against e-asset. management. Co., Ltd.

«Summary»

The SESC recommended that the prime minister and the commissioner of the FSA take an administrative action against e-asset. management. Co., Ltd. (hereinafter “the Company”), a Specially Permitted Business Notifying Person.

This recommendation is based on the findings of an inspection of the Company, whereby the director-general of the Kanto Local Finance Bureau identified that the Company had had problems concerning investor protection in its business operations.

Recommendation to impose an administrative penalty order against an officer of HANATEN Co., Ltd. and two offenders who committed insider trading related to shares of HANATEN Co., Ltd. using the information provided from the officer.

«Summary»

The SESC recommended that the Prime Minister and the commissioner of the FSA impose an administrative penalty order of 2,170,000 yen against an officer of HANATEN Co., Ltd. (hereinafter referred to as “offender (1)”), of 1,770,000 yen against an offender who received the information from offender (1) (hereinafter referred to as “offender (2)”), and of 1,710,000 yen against an offender who received the information from offender (1) (hereinafter referred to as “offender (3)”).

Based on an inspection, the SESC determined that offender (1) had communicated the insider information to offender (2) and offender (3), and that offender (2) and offender (3) had committed insider trading by purchasing shares of HANATEN Co., Ltd. using the insider information provided, in violation of the Financial Instruments and Exchange Act.

Filing a criminal charge against a person suspected of committing insider trading.

«Summary»

The SESC filed the charge against the suspect with the Yokohama District Public Prosecutors Office in violation of the Financial Instruments and Exchange Act (the “FIEA”).

On around October 1, 2014, the Suspect received information on a material fact concerning STAR HOLDINGS CO., LTD. (“STAR HOLDINGS”) listed on the JASDAQ operated by Tokyo Stock Exchange, Inc. from A. The material fact was that the decision-making body on the organization’s business operations of Midori Corporation had decided to conduct a tender offer for the shares of STAR HOLDINGS.

Between October 2, 2014, and February 5, 2015, prior to the announcement of the material fact, although there is no exemption clause applicable under the FIEA, the suspect bought a total of 59,400 STAR HOLDINGS shares for a total of 21,248,200 yen under the name of the suspect via a securities firm for the purpose of gaining profits by buying the shares prior to the announcement and selling the shares after the announcement.

Recommendation to impose an administrative penalty order against an offender who committed insider trading related to shares of WATABE WEDDING CORPORATION using the information provided from a contractor of WATABE WEDDING CORPORATION.

«Summary»

The SESC recommended that the Prime Minister and the commissioner of the FSA impose an administrative penalty order of 600,000 yen against an offender who received insider information from a contractor of WATABE WEDDING CORPORATION.

Based on an inspection, the SESC determined that the offender had committed insider trading by purchasing shares of WATABE WEDDING CORPORATION using the insider information, in violation of the Financial Instruments and Exchange Act.

Recommendation to impose an administrative penalty order against an offender who committed market manipulation related to shares of Cross Marketing Group Inc. and another security.

«Summary»

The SESC recommended that the Prime Minister and the commissioner of the FSA impose an administrative penalty order of 4,230,000 yen against an offender who committed market manipulation in violation of the Financial Instruments and Exchange Act.

Based on an inspection, the SESC determined that the offender had committed market manipulation through bolstering share prices of Cross Marketing Group Inc. and another security by placing purchase orders at higher prices than the contacted prices, and through Purchase Entrustments by placing a large amount of purchase orders of shares of Cross Marketing Group Inc. and another security at lower prices than the contracted prices, for the purpose of inducing sales and purchase of securities.

Through these techniques, the offender intended to mislead other persons into believing that the sales and purchase of the securities were thriving and cause fluctuations in market prices in his/her favor.

Recommendation to impose an administrative penalty order against an employee of TAKACHIHO KOHEKI CO., LTD. for committing insider trading related to shares of TAKACHIHO KOHEKI CO., LTD.

«Summary»

The SESC recommended that the Prime Minister and the commissioner of the FSA impose administrative penalty orders of 330,000 yen against an employee of TAKACHIHO KOHEKI CO., LTD.

Based on an inspection, the SESC determined that the offender had committed insider trading by selling shares of TAKACHIHO KOHEKI CO., LTD. using the insider information, in violation of the Financial Instruments and Exchange Act.