SESC Latest Topics No.54＜February 2019＞

Last Updated : February 28, 2019

What’s New on the SESC Website

This page contains the latest in events, developments, and updates to the SESC website.

Press Releases

(Following press release is available in Japanese)

 

Financial Instruments Businesses etc.

January
25, 2019:

Recommendation for an administrative disciplinary action against CLSA Securities Japan Co., Ltd.open new window

<Summary>

The SESC recommended that the Prime Minister and the Commissioner of the FSA take an administrative disciplinary action against CLSA Securities Japan Co., Ltd. (hereinafter "the Company"), a Type I Financial Instruments Business Operator.

Based on an inspection of the Company, the SESC identified that the Company had violated short selling regulations and failed to establish an adequate control environment for trading management.
January
11, 2019:

Court injunction against Clover Asset Management Co., Ltd., J trust Inc., the CEO of J trust Inc., and the de facto manager of both companies.open new window

<Summary>

In response to a petition filed on November 16, 2018 by the SESC with the Tokyo District Court for an injunction against Clover Asset Management Co., Ltd., J trust Inc. (hereinafter collectively "the Companies"), the CEO of J trust Inc., and the Companies' de facto manager to prohibit and suspend them from engaging in the Type Ⅱ financial instruments business without statutory registration, a court order was issued as per the content of the petition.

 

Market Misconduct

January
11, 2019:		 Recommendation to impose an administrative penalty order against an offender who committed market manipulation related to shares of DAIBEA Co., Ltd.open new window

＜Summary＞

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 2,730,000 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 by bolstering shares of DAIBEA Co., Ltd. by opposing his/her own purchase and sale orders at higher prices than the contracted prices for the purpose of inducing the sale and purchase of those securities.
Through this technique, the offender intended to mislead other people into believing that the sale and purchase of the securities were active and to cause fluctuations in market prices in his/her favor.
January
11, 2019:		 Recommendation to impose an administrative penalty order against an offender who committing insider trading related to shares of DREAM VISION CO., LTD.open new window

＜Summary＞

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 950,000 yen against an offender who received insider information from an employee of a contract signer with DREAM VISION CO., LTD.

Based on an inspection, the SESC determined that the offender had committed insider trading by purchasing shares of DREAM VISION CO., LTD. using insider information in violation of the Financial Instruments and Exchange Act.
December
21, 2018:		 Recommendation to impose an administrative penalty order against an employee of Oisix.daichi Inc. who recommended the purchase of shares of Oisix.daichi Inc.open new window

＜Summary＞

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 120,000 yen against an employee of Oisix.daichi Inc. 

Based on an inspection, the SESC determined that the offender had committed the offense of recommending the purchase of shares of Oisix.daichi Inc. to an acquaintance in violation of the Financial Instruments and Exchange Act.
December
21, 2018:		 Recommendation to impose an administrative penalty order against an offender who committing insider trading related to shares of Y.S. FOOD CO., LTD.open new window

＜Summary＞
The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 1,930,000 yen against an offender who received insider information from an officer of a contract negotiator of Y.S. FOOD CO., LTD.

Based on an inspection, the SESC determined that the offender had committed insider trading by purchasing shares of Y.S. FOOD CO., LTD. using insider information in violation of the Financial Instruments and Exchange Act.
December
11, 2018:		 Recommendation to impose an administrative penalty order against an offender who committed market manipulation related to shares of Softfront Holdings and other securities.open new window

＜Summary＞

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 795,000 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 Softfront Holdings and other securities through purchase entrustments, by placing a large amount of purchase orders of shares of Softfront Holdings and other securities at lower prices than the contracted prices, after purchase orders at higher prices than the contracted prices, for the purpose of inducing the sale and purchase of securities.

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

The SESC had recommended that the prime minister and the commissioner of the FSA impose an administrative penalty order against an offender who committed market manipulation in violation of the Financial Instruments and Exchange Act on February 2, 2016.
December
7, 2018:

Recommendation to impose an administrative penalty order against an offender who committed market manipulation related to shares of Trust Co., Ltd.open new window

＜Summary＞

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 13,000,000 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 acts such as repeatedly bolstering share prices of Trust Co., Ltd. by purchase orders at market order or higher 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. 

False Disclosure Statement

November
20, 2018:

Recommendation to impose an administrative penalty order against SDS Holdings Co., Ltd for making false statements in its disclosure documentsopen new window

<Summary>

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 34,420,000 yen against SDS Holdings Co., Ltd ("the Company"). Through an inspection of the Company's disclosure statements, the SESC alleged that the Company had disclosed false statements in its annual security reports and quarterly reports as in the following;

・the Company's consolidated subsidiary overstated and front-loaded its sales and did not  adequately record its construction costs. In addition, the Company recorded fake sales by creating fictitious transactions.

・the Company deferred writing off the loss from its overseas project and understated the loss.
October
23, 2018:

Recommendation to impose an administrative penalty order against UKC Holdings Corporation for making false statements in its disclosure documents.open new window

<Summary>

The SESC recommended that the Prime Minister and the Commissioner of the FSA impose an administrative penalty order of 18,000,000 yen against UKC Holdings Corporation ("the Company"). Through an inspection of the Company's disclosure statements, the SESC alleged that the Company disclosed false statements in its annual security reports and quarterly reports, based on the facts that, through the sales transactions of LCD panels in the Company's consolidated subsidiary, the Company understated allowances for bad debts and overstated its sales by creating fictitious transactions.

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