Olympus 'hid $1.67 billion losses from investors'

An investigative panel has found Japan's disgraced Olympus Corp hid up to $1.67 billion in losses from its investors, but is likely to say there is no evidence of organised crime in the cover-up, a source said today.

The panel will also stop short of recommending criminal charges against executives involved in the accounting scandal, presenting only the facts and leaving Olympus to pursue this aspect. "That is up to the company," the source said.

The panel's report is due to be released on Tuesday, almost two months after Olympus's sacked chief executive, Englishman Michael Woodford, went public with his concerns over its dubious accounting for a series of murky acquisitions.

The maker of cameras and medical equipment has since lost more than half its market value and risks being delisted from the Tokyo stock exchange, a sanction that would cut it off from equity markets and put it under pressure to sell core assets.

But it may be able to avoid that humiliation if there is no proof of the much-rumoured link between the cover-up and Japan's "yakuza" gangsters - and if Olympus can meet a December 14 deadline to iron out its books and report its second-quarter results.

Olympus shares rose 3% on the news, though investors remain on tenterhooks for the panel's official findings and the outcome of a separate, joint investigation by police, prosecutors and the market regulator.

The source said the panel found that former executive vice president Hisashi Mori and ex-internal auditor Hideo Yamada had led the cover-up of losses, which amounted to ¥130 billion ($1.67 billion) at its peak.

The panel has found Mori and Yamada then informed former president Tsuyoshi Kikukawa, the source added. Kikukawa at first publicly rejected the accusations of a cover-up when the scandal broke in October, but he later quit and the company conceded it had hid investment losses stretching back as far as two decades.