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Last Updated: Thursday, 15 March 2007, 20:31 GMT
Verdict due for Livedoor tycoon
Takafumi Horie
Lawyers for Mr Horie claim he is being framed
Controversial tycoon Takafumi Horie will learn his fate shortly after a six-month trial into alleged fraud which has gripped corporate Japan.

The former boss of internet firm Livedoor is accused of falsifying the company's accounts and misleading investors, which he has denied.

If convicted, prosecutors want Mr Horie, 34, to be jailed for four years.

The trial explored Japanese business values, with Mr Horie seen to represent a brasher, more aggressive culture.

Culture clash

Mr Horie was extremely popular with a new breed of investors for his informality of style and business ambition, which saw Livedoor expand rapidly in a short space of time through a series of daring takeovers.

But Mr Horie's high public profile, which saw him stand for parliament and date a number of leading actresses, put him at odds with Japan's conservative business establishment.

In the Japanese court system, expressing remorse and paying penance can be a key factor to mitigate punishment
Yoji Ochiai, an attorney

Livedoor was raided by prosecutors at the start of 2006 after allegations of financial impropriety surfaced and Mr Horie was subsequently arrested.

The Tokyo stock market was forced to close briefly when news of the investigation triggered a massive share sell-off.

Unlike many previous corporate scandals where businessmen have confessed their guilt in return for more lenient sentences, Mr Horie has maintained he is innocent.

But four other senior Livedoor executives have admitted their guilt, with former chief financial officer Ryoji Miyauchi acting as a leading prosecution witness.

Mr Horie is accused of conspiring to hide losses at the firm in 2004 and painting a falsely optimistic picture of Livedoor's health to keep analysts happy and support the share price.

Establishing knowledge

The case has centred around how much Mr Horie knew about the state of Livedoor's finances and whether he conspired with other executives to inflate profits.

Critics of Mr Horie's actions have described Livedoor's fall from grace as a "Japanese version of Enron", but Mr Horie has maintained he did not give false information to investors about the firm's prospects and was not aware of any manipulation of its accounts.

Legal experts said Mr Horie's repeated protestations of innocence and his unwillingness to show any remorse could prove determining factors in the outcome of the trial.

"In the Japanese court system, expressing remorse and paying penance can be a key factor to mitigate punishment," said Yoji Ochiai, an attorney not involved in the trial.

"In Japan there is a culture that those who admit to a crime and reflect on their act should be readmitted to the community, which is reflected in criminal trials."

Whatever the outcome of the trial, both sides are expected to appeal against the verdict.

Fund head denies Livedoor charges
01 Dec 06 |  Business
Livedoor sells financial business
22 Nov 06 |  Business
Livedoor man 'framed' says lawyer
07 Sep 06 |  Business
Livedoor's Horie pleads innocence
04 Sep 06 |  Business
Livedoor chief Horie is charged
13 Feb 06 |  Business
Livedoor chief Horie steps down
24 Jan 06 |  Business

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