Senior industry ministry official faces insider trading charge

January 07, 2012

Prosecutors appear set to slap insider trading charges against a senior industry ministry bureaucrat who was involved in the public bailout of chipmaker Elpida Memory Inc. in 2009, sources said.

The official, 53, is suspected of buying Elpida shares based on inside information that public funds would be injected into the troubled company.

The Securities and Exchange Surveillance Commission is expected to soon file a criminal complaint with the Tokyo District Public Prosecutors Office over the case.

The official, former director-general for Natural Resources and Energy Policy, has denied the allegations, saying he bought the shares based on his wife's instructions after the injection plan became public knowledge by media reports.

The official was involved in the Elpida Memory bailout when he was a deputy director-general at the industry ministry's Commerce and Information Policy Bureau from February to June of 2009.

He bought about 5,000 shares of the company between May and June that year after learning the government would inject public funds, the sources said.

The official is also suspected of buying shares of chipmaker NEC Electronics Corp. in April 2009 based on unpublished information about its merger talks, the sources said.

He bought about 5,000 NEC Electronics shares using his wife's account, the sources said. NEC Electronics later merged into Renesas Electronics Corp.

The official allegedly earned about 2 million yen ($26,000) through these transactions.

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