(Excerpt)
(Monday, December 23, 2024, 5:47 pm to 5:50 pm)
- Q.
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Today, regarding the insider trading cases committed by an FSA official and a former employee of the Tokyo Stock Exchange, the Securities and Exchange Surveillance Commission (SESC) filed a charge against those people with the Tokyo District Public Prosecutors Office. Could you explain your view and the FSA's responses regarding this issue?
- A.
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First of all, today, an FSA official, a former employee of the Tokyo Stock Exchange, who are in a position to supervise financial markets were charged by the SESC for their suspected violation of the insider trading regulations under the Financial Instruments and Exchange Act.
These cases not only undermine public confidence in the financial administration but also damage public trust in Japanese financial markets. They must not be allowed to occur and are very regrettable.
In response to the criminal accusations, the FSA imposed punitive measures against the people concerned, today.
Based on the National Public Service Act, the relevant FSA official was dismissed.
Additionally, a penalty of a 10%-pay cut for three months was imposed on the Director of the Corporate Accounting and Disclosure Division of the Policy and Markets Bureau, where the official belonged at the time of committing the acts, and a reprimand was issued to the former Director General and the present Director General of the Policy and Markets Bureau. The former Director General is the present Commissioner.
The FSA issued these dispositions against officers in supervisory positions in consideration of the weight of their supervisory responsibilities, as the relevant official's acts in violation of the insider trading regulations were closely related to their duties, and such violation by a person in charge in the regulatory authority has a significant influence in society amid a recent series of misconduct at financial institutions.
The FSA will endeavor to disseminate a sense of compliance throughout the organization, prohibit officials in charge of TOB screening from conducting share trading, and strengthen identity confirmation upon recruitment and acceptance of loaned employees, as recurrence prevention measures so as to ensure that these cases will never be repeated. We will make the utmost efforts for securing public trust in the financial administration and financial markets in Japan.
Additionally, we consider it important for JPX and the Tokyo Stock Exchange to analyze causes of these cases and take effective recurrence prevention measures based on the analysis results so that other similar cases will never occur.
Accordingly, the FSA plans to issue an order to JPX and the Tokyo Stock Exchange to request reporting in order to confirm the factual relationships.
