Sponsored by: Investment Center

Something new in your business?  Click here to submit your business press release

Chamber Corner | Main Street News | Job Hunt | Classifieds | Calendar | Illinois Lottery 

Japan bank mulls cleanup, penalties for gang loans

Send a link to a friend 

[October 26, 2013]  TOKYO (AP) -- Mizuho Bank, Japan's second largest megabank, is bracing for a shakeup as regulators look into allegations it lent more than 200 million yen ($2 million) to people with links to organized crime.

The bank on Friday denied news reports saying its chairman would step down and president lose months of pay as penalties meted out to some 30 Mizuho executives for failing to comply with laws against lending to "anti-social forces," a byword in Japan for criminal gangs.

No decision has yet been made, the bank said in a statement responding to reports in the Nikkei Shimbun and other publications, which cited unnamed Mizuho Bank officials.

Mizuho faces a deadline Monday to submit to the Financial Services Agency plans for improving its lending business, along with any further information uncovered by investigators appointed by the bank.

The bank issued an apology earlier this month for "any concern or inconvenience" to customers and shareholders over the FSA's order to improve its joint loan business with its consumer finance unit, Orient Corp.

The loans in question, mostly auto loans, were made through Orient, which has pledged to end them.

Mizuho said an in-house probe had found that transactions with "anti-social elements" were known about in early 2011 and reported to some senior executives, contrary to earlier statements that the information had not been shared to topmost management.

[to top of second column]

But the problems were set aside at the time as the bank scrambled to deal with ATM malfunctions triggered by an influx of donations for victims of the 2011 tsunami disaster.

The troubles at Mizuho underscore the difficulties financial companies confront in avoiding dealings with those deemed to be affiliated with organized crime and are reinforcing calls for more data sharing by police and financial institutions.

Japanese gangs, known as "yakuza," have long been involved in many areas of the economy, despite efforts to freeze them out of the financial system.

[Associated Press; By ELAINE KURTENBACH]

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
 

< Recent articles

Back to top