Toshiba Corp. is under investigation by the U.S. over allegations that it hid $1.3 billion in losses at its nuclear power operations, according to two people familiar with the matter. Shares plunged in Tokyo.
The Justice Department and the Securities and Exchange Commission are looking into whether fraud was committed, said the two, who asked not to be named because the investigations aren’t public. The probes, they said, follow one by Japan’s securities regulator, which found that Toshiba falsified financial statements and documents involving its issuance of corporate bonds.
U.S. authorities are scrutinizing allegations made in an internal review published last year by the Tokyo-based company, the two people said. The report, a 334-page version of which was published in English on Toshiba’s website in December, said management was complicit in padding profits for almost seven years. It led to the resignations of top officials, including Hisao Tanaka, Toshiba’ president and chief executive officer. read more here