We can clearly see the Serious Fraud Office’s (SFO) move to drop the fraud case against Olympus Corporation a big hole in the country’s legal system. Legal experts all over the UK are calling for a reform of laws to guarantee that no company similar to the activities of Japanese company Olympus Corporation ever makes false and misleading statements in the future.
Accounting fraud can cause an imbalance in the financial system, which is protected by the law.
Olympus Corporation’s Legacy
The case began when former Olympus British Chief Executive Michael Woodford mentioned an alleged £1.1 billion accounting fraud accompanied by unusual consultants payments.
After referring the case to the SFO just two weeks after reigning in the company in his leadership, the companies, both Olympus in Japan and Gyrus Group, its representative in the UK, were charged with serious fraud.
False and misleading statements against the company’s auditors based itself on evidence that forgery had happened between 2010 and 2011.
The Failure Of British Prosecution
While the case is dropped in the United Kingdom, Olympus paid dearly in Japan. Fined with £3.7m despite three executives pleading guilty for covering up its losses, the three were given suspended jail sentences.
Legal experts highlighted the need for better and transparent laws that would allow the UK to prosecute companies in the land and clear old laws failing to meet modern demands.