SESC Latest Topics No.92＜August 2023＞

Recommendation for administrative disciplinary action against Chibagin Securities Co., Ltd., The Chiba Bank, Ltd., and The Musashino Bank, Ltd.

<Summary>

The SESC recommended that the Prime Minister and the Commissioner of the FSA take administrative disciplinary actions against the following entities: Chibagin Securities Co., Ltd., a Type I Financial Instruments Business Operator and Investment Advisor/Agency; The Chiba Bank, Ltd., a Registered Financial Institution; and The Musashino Bank, Ltd., a Registered Financial Institution (hereinafter collectively "the Companies").

These recommendations are based on findings in inspections of the Companies, under which the Director-General of the Kanto Local Finance Bureau identified that the business operations of Chibagin Securities Co., Ltd. had been in violation of the Principle of Suitability and that both The Chiba Bank, Ltd. and The Musashino Bank, Ltd. had problems concerning investor protection in financial instruments intermediary services.

Petition for a court injunction against S DIVISION HOLDINGS INC., STEPCAPITALMANAGEMENT, Inc. and their manager.

<Summary>

Based on investigations of S DIVISION HOLDINGS INC. (hereinafter “SDH”) and STEPCAPITALMANAGEMENT, Inc. (hereinafter “CAPITAL”), the SESC identified that (i) SDH and SUMI Hajime, the Chairman of SDH, had conducted public offerings of its foreign corporate bonds, without statutory notification, and (ii) CAPITAL and SUMI Hajime, the Representative Director of CAPITAL, had conducted public offerings of its corporate bonds, without statutory notification, and dealt in public offerings or private placements of SDH’s foreign corporate bonds, without statutory registration, etc. The SESC filed a petition with the Osaka District Court to issue an order against them to prohibit and stay the aforementioned activities in violation of the Financial Instruments and Exchange Act.

Recommendation for an administrative monetary penalty payment order against a recipient of information from an officer of TOHTO SUISAN CO., LTD. (hereinafter, “the Company”) who committed insider trading related to shares of the Company.

<Summary>

The SESC recommended that the Prime Minister and the Commissioner of the FSA issue an administrative monetary penalty payment order of 270,000 yen against a recipient of information from an officer of TOHTO SUISAN CO., LTD. (hereinafter, “the Company”).
 
Based on an inspection, the SESC determined that the recipient of information had committed insider trading by purchasing shares of the Company, using insider information, in violation of the Financial Instruments and Exchange Act.

Recommendation for an administrative monetary penalty payment order against an employee of CellSource CO., LTD. (hereinafter, “the Company”) who committed insider trading related to shares of the Company.

<Summary>

The SESC recommended that the Prime Minister and the Commissioner of the FSA issue an administrative monetary penalty payment order of 440,000 yen against an employee of CellSource CO., LTD (hereinafter, “the Company”).
 
Based on an inspection, the SESC determined that the employee had committed insider trading by purchasing shares of the Company, using insider information, in violation of the Financial Instruments and Exchange Act.