A Japanese Internet empire is on the verge of collapse after its founder and other top executives were arrested on charges of securities fraud.
Japanese prosecutors have arrested Takafumi Horie, the founder and CEO of the Internet portal Livedoor and other Net-related businesses, and three other top executives on charges of securities-law violations.
It looks like Livedoor could well become the next Enron. Expect the usual share price collapse, de-listing, fire-sales and executive court room jostles. There seem to have been so many high profile collapses and executive misdemeaners since Enron blew up. Is this because the regulators are getting better at spotting it? Probably.
You just have to feel for the next bunch of largely innocent shareholders getting ripped off. There's something wrong with the system...
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2 comments:
Perhaps Enron is not the ideal example because fraud and failure. Worldcom might be closer, but maybe the Gizmondo business model is a closer match.
Have you seen the news stories on the Gizmondo looting ... er, sorry ... business reversal? The top management made millions per year in stock and salary. They paid hundreds of thousands to lovers, wives and lawyers, while investors lost $160M to $270M in the bankruptcy filing. Limited assets, no real product, management takes huge up-front compensation, deceptive reporting without actual fraud.
See
BetaNews | Gizmondo Europe Files for Bankruptcy
Gizmondo parent secures debt with Smart Adds IP | The Register
hello,
I'm currently working on a dissertation on US Securities and Fraud and my focus is on disclosure/ reporting practices by the large tech firms and such. chancing upon your blog, I'd like to find out if u have any views on securities law governing such practices in the US.
Please email me at dion_tong@hotmail.com if you do. Cheers!!!
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