FBI arrests former bank VP in connection with Olympus financial scandal
posted Friday, December 21, 2012 at 5:40 PM EDT
The FBI yesterday announced a new arrest related to the financial scandal at Olympus Corp., which first came to light late last year. Former bank vice president Chan Ming Fon allegedly assisted Olympus in hiding losses on bad investments by investing -- and then secretly liquidating -- hundreds of millions of dollars in the SG Bond Plus Fund, which was managed by Chan. He then helped an Olympus-controlled entity, Easterside Investments, to liquidate the bonds purchased by Olympus.
Chan, a 50-year-old Taiwanese national currently residing in Singapore, spent the next six years or so misleading Olympus' auditors as to the status of the investments, certifying that they still existed long after they had been liquidated, and forging the signature of a bank representative. The funds secretly released from the bonds had by then been used by Olympus to pay off an outstanding loan.
Chan was arrested yesterday in Los Angeles, California. According to the FBI, he confessed earlier this week to receiving more than US$10 million for his part in the fraud. He has been charged with one count of wire fraud, an offense which carries a maximum penalty of 20 years in prison.
The FBI statement doesn't identify the companies Chan worked for, but Reuters identifies him as a former employee of Frankfurt-based Commerzbank AG and Paris-based Société Générale. Chan is also said to be a current director of three Singaporean firms: GIT Capital, GIT Consulting and SJ New Energy.
More details in the Reuters article.
(via the FBI and Reuters)