(Kyodo News International via NewsEdge) The head of a company that managed two investment partnerships to sell shares of Internet firm Livedoor said he suspected Livedoor executives of trying to utilize these partnerships to manipulate the company's books.
Former Livedoor president Takafumi Horie, 33, and other former Livedoor executives are alleged to have used the investment partnerships to post 3.7 billion yen ($31.9 million) in profit on sales of Livedoor shares to manipulate the books for the year to September 2004.
'The partnerships were created for the sole purpose of selling Livedoor shares,' the company head responsible for managing the partnerships said during the second hearing of Horie's trial at the Tokyo District Court.
'I suspected that Livedoor executives were willing to manipulate the financial books by transferring profit on the share sales to Livedoor,' the witness, appearing for the prosecution, added.
He said then H.S. Securities vice president Hideaki Noguchi requested him to create the first of the two partnerships to sell Livedoor shares around October 2003.
Noguchi killed himself before Horie and other former Livedoor executives were arrested on financial fraud charges early this year.
In February 2004, the witness said he reluctantly accepted another request by Noguchi and a Livedoor executive to create another partnership for a similar purpose.
Part of the proceeds from the Livedoor share sales were remitted to a Hong Kong firm that Livedoor executives set up, he said.
The court plans to hold 26 hearings in the Horie trial by late November.
© 2006 Kyodo News International, Inc.
© 2006 Dialog, a Thomson business. All rights reserved