ID :
10789
Wed, 06/25/2008 - 14:19
Auther :
Shortlink :
https://oananews.org//node/10789
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Ex-Nova boss Sahashi arrested for alleged embezzlement
OSAKA, June 25 (Kyodo) - Police on Tuesday arrested Nozomu Sahashi, former president of now-bankrupt Nova Corp., on suspicion of diverting around 320 million yen in July from an employee benefit fund to reimburse tuition fees to people who canceled contracts for language courses.
Sahashi, 56, is being held on a charge of professional embezzlement, along with Toshihiko Murata, 49, an official who was in charge of accounting at the company. Sahashi has only admitted to part of the allegation, while Murata has admitted to it, according to the police.
Osaka prefectural police also searched several locations including the headquarters of Nova in Chuo Ward in the city of Osaka in connection with the arrests that came roughly eight months after the failure of the company, which operated what was once the nation's largest chain of English conversation classes.
According to investigations, Sahashi and Murata are suspected of diverting around 320 million yen to a bank account of a company controlled by Sahashi on July 20. Almost all of the money came from a fund for an employee mutual aid association.
The association was set up with Sahashi as chief and collected around 2,000 yen from each employee's monthly salary to build up a fund for congratulatory and condolence payments as well as trips organized for employees, the investigations showed. The fund was run separately from the company's accounts and controlled by Murata and others.
The alleged diversion followed a government order the previous month directing Nova to suspend some of its operations after it was accused of exaggerated advertisements and lying to prospective students about tuition charges, which led to a surge in contract cancellations.
On July 20, Nova had to meet reimbursements of around 530 million yen for canceled contracts, according to the investigations.
Sahashi was discharged in October and Nova filed for corporate rehabilitation that month.
Sahashi started running English conversation classes in Osaka in 1981 and set up Nova in 1990. His venture grew rapidly and went public in 1996. At its peak in 2005, Nova had 480,000 students and in 2006, with more than 1,000 classes, it was the nation's largest chain of English conversation schools.
Nagoya-based G.communication Co. took over some of Nova's operations in November.
Sahashi, 56, is being held on a charge of professional embezzlement, along with Toshihiko Murata, 49, an official who was in charge of accounting at the company. Sahashi has only admitted to part of the allegation, while Murata has admitted to it, according to the police.
Osaka prefectural police also searched several locations including the headquarters of Nova in Chuo Ward in the city of Osaka in connection with the arrests that came roughly eight months after the failure of the company, which operated what was once the nation's largest chain of English conversation classes.
According to investigations, Sahashi and Murata are suspected of diverting around 320 million yen to a bank account of a company controlled by Sahashi on July 20. Almost all of the money came from a fund for an employee mutual aid association.
The association was set up with Sahashi as chief and collected around 2,000 yen from each employee's monthly salary to build up a fund for congratulatory and condolence payments as well as trips organized for employees, the investigations showed. The fund was run separately from the company's accounts and controlled by Murata and others.
The alleged diversion followed a government order the previous month directing Nova to suspend some of its operations after it was accused of exaggerated advertisements and lying to prospective students about tuition charges, which led to a surge in contract cancellations.
On July 20, Nova had to meet reimbursements of around 530 million yen for canceled contracts, according to the investigations.
Sahashi was discharged in October and Nova filed for corporate rehabilitation that month.
Sahashi started running English conversation classes in Osaka in 1981 and set up Nova in 1990. His venture grew rapidly and went public in 1996. At its peak in 2005, Nova had 480,000 students and in 2006, with more than 1,000 classes, it was the nation's largest chain of English conversation schools.
Nagoya-based G.communication Co. took over some of Nova's operations in November.
