FSA to consider additional action against Mizuho
TOKYO (Kyodo) -- The Financial Services Agency will consider taking additional administrative action against Mizuho Bank after the bank reports later this month how and why its earlier report on its loans to crime groups failed to disclose the truth about the involvement of its executives, according to FSA officials.
Mizuho Bank, one of the biggest Japanese lenders, may face criminal prosecution if the second report to the agency, to be submitted by Oct. 28, shows that the bank obstructed the authorities by intentionally hiding documents.
Mizuho has been ordered to compile a second report after it admitted Tuesday that top management had been alerted to the issue after saying in the first report that only an executive in charge of legal compliance had been aware of the transactions.
The FSA had previously ordered Mizuho on Sept. 27 to improve operations after its failure to deal with the loans.
It is poised to dish out an additional administrative penalty -- possibly an order to suspend operations -- if the bank's upcoming report shows new important facts, though it could take no further action if it was proved to be just negligence, a senior FSA official said.
There has also been criticism that the FSA's latest inspection of the bank, which began in December, was not sufficient because the FSA, according to Mizuho President Yasuhiro Sato, did not require at the time that the bank submit documents on the loans that had been presented to the board.
"If President Sato's account is true, the FSA should also examine whether its inspection was performed appropriately," said a source in the banking sector.
Police investigations have found that dozens of gangsters were among the 230 "antisocial" borrowers of Mizuho's so-called "tie-up" loans through group credit company Orient Corp., which screens clients on the bank's behalf when clients buy cars or electronics, investigative sources said the same day.
The Metropolitan Police Department has obtained data from the bank and is checking to see if gang members took out loans under false pretenses, the sources said.
October 13, 2013(Mainichi Japan)