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Kobayashi Yoko Co. has been ordered to suspend its consigned commodity futures trading business for 43 days for concealing details of problematic transactions from authorities over several years.
The administrative punishment was handed out by the Economy, Trade and Industry Ministry and the Agriculture, Forestry and Fisheries Ministry under the Commodity Exchange Law and will cover the period from July 17 to Sept. 13.
The major commodity futures trading company announced Friday it has appointed Hideki Yamashita as its new president after Hideo Seikaku resigned from the position to take responsibility for the company's actions.
The law states that companies trading in futures must inform the government every month of any transactions that customers have complained about.
According to METI, Kobayashi Yoko had been systematically concealing its actions through such means as omitting problematic transactions from data to be submitted to the government and falsely reporting details of payments in out-of-court settlements. Since 1999, it has not reported more than 600 transactions that customers have had problems with.
The Chuo Ward, Tokyo-based firm, which deals in futures transactions in precious metals, agricultural products, petroleum products and other commodities, has been found to have misled individual customers by telling them they would definitely make a profit and also to have bought and sold commodities without instruction or permission from customers.
It reportedly pitched its products at customers with lines such as: "You'll definitely make money," or "You won't lose out because we treat our large customers like corporations."
It also targeted customers that had lost money by guaranteeing future profits in campaigns professing to recoup losses.
Kobayashi Yoko's offenses were uncovered by METI during regular investigations in January last year.
© The Yomiuri Shimbun.
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