Japan Trustee Services Bank sues Toshiba for $120 million
One of Japan's top securities processing bank, with assets upwards of 200 trillion yen, filed a suit against Toshiba against the losses it suffered from Toshiba's accounting scandal. The trust bank sued the technology firm for nearly $120 million. The bank had filed the charges at the Tokyo District Court earlier this month, Toshiba said in a statement.
Toshiba's accounting scandal
Japanese technology giant Toshiba was caught in a massive accounting scandal last year when investigative reports found that the company had overstated its profits by over $1.2 billion. The company had been supported by senior management to work on inappropriate accounting practices that started from 2008, after the recession. Soon after the scandal came to light, Toshiba's CEO and Vice Chairman stepped down.
Japan officials disappointed over accounting malpractice
"I'm totally disappointed because it could damage investor confidence in the Japanese market," said Japan's Deputy Prime Minister Taro Aso, who is also in charge of the securities market and Japan's finance ministry.
Toshiba to set aside an amount to cover charges
"In relation to the action, the company intends to record a provision for a reasonably estimable amount, which has not yet been determined," Toshiba Corp said in its statement released on Thursday.
Toshiba estimates revision to its forthcoming financial results
Toshiba Corp also stated that it might issue an immediate notice, if the conglomerate expects that the charges filed will hurt their financial results, and may revise the future guidance figures. In the statement, Toshiba said it would be handling the suit according to the assertions filed. The company also said that the liabilities due might increase over the course of the case.
