Stiffer Penalties for Securities Violations
In the wake of the Livedoor and Murakami scandals, Japan is toughening its securities law. Under revisions of the Financial Products Trading Law, the maximum term for insider trading has been hiked from three to five years. Surveillance of market activity for illegal transactions will also be strengthened. The top term for falsifying accounts and other schemes that dissemble to boost stock prices will be upped from five years to ten years. Regulators hope the longer sentences will stem securities crimes. In addition, laws governing takeover bids will be reviewed at the end of the year, and new rules for solicitations and buy-outs should go into effect next summer.