The Financial Services Agency on Feb. 24 issued a business suspension order to AIJ Investment Advisors Co., which says it has no idea why billions of yen in corporate pension funds are missing.
According to sources, a large majority of the estimated 200 billion yen ($2.5 billion) in pension funds that AIJ was handling on behalf of companies appears to have been lost.
During the one-month period when operations are suspended, officials from the FSA and the Securities and Exchange Surveillance Commission will investigate whether the money was lost due to poor investment decisions made by AIJ or whether company officials diverted the money for their own use.
Criminal complaints could be filed against the company depending on the outcome of the investigation.
No funds can be withdrawn during the period when business operations are suspended.
Sources said AIJ officials have said they were unable to explain how much money was lost or why.
According to documents of a business group covering investment advisory companies, AIJ had about 210.1 billion yen in corporate pension funds as of the end of March 2011 from about 120 companies around Japan, including Yaskawa Electric Corp., a manufacturer of industrial robots.
Sources said AIJ had explained to its corporate clients that steady gains were being made in the investments placed by AIJ.
If the lost money cannot be recovered, the corporate clients who placed the money in AIJ will have to cover the losses in making future pension payments to their retirees.
The FSA will also look into the approximately 260 other investment advisory companies to see if they have similar problems as AIJ.
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