TAKAFUMI HORIE, the 33-year-old maverick businessman at the centre of Tokyo’s most hotly anticipated corporate fraud trial for decades, has one last act of defiance in store. He plans to flout Japanese company convention by pleading not guilty.
Mr Horie, who is facing charges of spreading false information and window-dressing accounts, may also attempt the virtually unheard-of tactic of blaming his senior staff for the scandal that ultimately destroyed Livedoor, the internet company that he founded.
In an exclusive interview with The Times, Mr Horie’s lawyer broke a pre-trial silence to say that his client’s lack of confession and decision to plead not guilty had blind-sided the Tokyo Prosecutor’s office.
Yasuyuki Takai said: “This is a complicated case and the prosecutors simply do not understand it fully. They expected Horie to confess, and now that he has denied all the charges completely the prosecutors are in serious trouble. The Japanese prosecutors’ system is not prepared for a case without a confession.”Horie has done a lot of shaking up in his relatively brief career. Japundit had an extensive series of posts about the Japanese baseball leagues and although Horie failed to get control of any baseball team, the changes introduced before the 2005 season were in large part due to Horie's attempts. Likewise he exposed the vulnerable underbelly of the incestuous cross share holdings of Japanese media groups in his failed attempt to get control of a TV station and his attempts to get elected for the Koizumi government eventually led to the collapse of the opposition this year as one opposition MP turned out to have faked an email that apparently showed Horie donating to the LDP. Finally the implosion of Livedoor showed all sorts of vulnerabilities with the Tokyo Stock Exchange and its systems.
The case has broken starkly with tradition, being the first to exploit a new law aimed at speeding up Japan’s long, drawn-out trials. The insider-dealing trial surrounding the Recruit group that began in 1988, for example, took 14 years to reach a verdict.
Under a new law, prosecutors and defence lawyers meet before the trial to establish what areas will be covered and how the evidence will be presented. Mr Takai believes the introduction of that system means the Livedoor trial will be over within six months.But it seems clear that his refusal to take responsibility for the actions of his underlings is going to be the biggest issue. In the past Japan's top executives have usually taken responsibility for the actions of their underlings but, as a quid pro quo, their punishments have usually been more of a slap on the wrist than anything serious and they generally return to more junior positions on corporate boards and so on after the fuss has died down. Perhaps one reason why Horie is not following tradition here is that he figures (probably correctly IMHO) that there is no way anyone will ever let him back into business unless he is found to be innocent (and I would guess not much chance even so). In other words unlike the usual Japanese business leader who is accused of various crimes there is no reason for him to cooperate and much incentive for him to fight.