The brokerage arm of Sumitomo Mitsui Financial Group, SMBC Nikko Securities Inc, says an employee at a Tokyo branch swindled 16 individual investors out of a total of about 880 million yen (more than $10 million) over an 11-year period to earlier this year. The employee, who was in charge of sales for individual investors, promised the 16 clients high returns in bogus investment schemes to defraud them between 2001 and earlier this year. The company said it will consider how to deal with the alleged fraud after examining the case more closely.
I think this story is worth following because it could help illustrate Japanese work culture. One aspect to watch out for as this story unfolds is who benefited from the fraud? In the U.S., corporate swindlers defraud investors for their own personal gain, while in Japan’s duty-bound work culture, swindlers steal for their companies. If the employee, identified only as a man in his 40s, was stealing for his company, as I suspect, investors should ask why did Sumitomo take 11 years to uncover the fraud?