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December 22, 2011

Olympus Headquarters Raided by Teams of Investigators

By Oliver VanDervoort, Contributing Writer

It’s been a pretty bad winter for Japanese camera maker Olympus. Earlier this month, a six man independent investigative panel found that Olympus’ shady business practices had led to the company losing more than $1.7 billion in investment dollars. This particular finding was not long after the company had announced that they would be reforming the way they did business. Ex-CEO Michael Woodford had originally brought the company’s less than ideal practices to light after he was fired in October.

Yesterday dozens of new investigators descended on several of the subsidiary base of operations, looking to see just how the company managed to go so wrong. Additional investigative teams also swarmed over the homes of various members of the company’s upper management and of course at the company’s main location, a downtown high-rise. The raids were first leaked to the media and are apparently a rare teaming up of Japan’s police force, prosecutors and financial regulators.

The nearly 100-year-old company has admitted to hiding various losses through shady stock trades and other deals going back almost 20 years. The company has also had several of the higher level executives that worked for the company admit that they knew of what was going on. These executives include three former CEOs as well as staff legal counsels and some of their top investment bankers.

The company has issued a formal apology to their stock holders, who seem to be deserting the company at an alarming pace. Olympus also had to file five years of adjusted balance sheets in order to avoid being delisted from the Tokyo stock exchange. These particular moves stand little chance of actually helping the company move past this embarrassing fiasco. 

Woodford is actually trying to get his old job back, but Olympus recently got the OK from its bankers to bring in someone from outside the company to right the ship. One thing that could end up saving the company from abject failure is a new release of company shares. Some reports have other tech companies like Sony and Fujifilm buying some shares of the company, giving Olympus a much needed capital injection.

Edited by Jennifer Russell
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