SECURITIES AND EXCHANGE SURVEILLANCE COMMISSION
November
13, 1998
The Securities and Exchange Surveillance
Commission (SESC) conducted the inspection of Dresdner kleinwort Benson (Asia) Limited,
Tokyo Branch (Dresdner) based on the provisions of the Law on Foreign Securities Firms
(LFSF) and found legal violations described below.
The SESC sent recommendation to the Prime Minister and the Commissioner
of Financial Supervisory Agency to take disciplinary action against Dresdner pursuant to
Article 181) of Financial Supervisory Agency Establishment Law on November 13, 1998.
(Submitting transaction reports
containing false statements to customers)
From August 1997 to
July 1998, the employees of the domestic section and other sections of Dresdner informed
certain customers of the wrong prices which were different from the market prices by
mistake (18orders).
After informing to the customers of the prices of their orders,
Dresdner got to find that the prices were wrong by checking up the prices informed to the
customers and the execution prices written on the transaction reports from the Tokyo stock
exchange.
Although Dresdner realized that there were mistakes among the prices
which had been informed to the customers. Dresdner did not try to inform to their
customers of their mistakes because Dresdner thought if their customers had realized its
mistakes it would have loosen its reputations among customers.
For this reason Dresdner switched the customers' transactions truly
executed in the market to the transactions on their own account and applied to the stock
exchange for"corrections of errors" to make other transactions off the session to make
up the customers' transactions with them and finished the deals of the customers so that
the off-the-session transactions would seem to be true ones. As a result, Dresdner made up
false reports of them and sent them to the customers.
(Violation
of LFSF Article 37(3)) |