Olympus Corporation, the Japanese optical giant, shed 30% of its share prices today as a result of clarifications in an ongoing scandal.
The company's British CEO Michael Woodford had resigned a month ago claiming that he had not received answers about the exorbitant consultancy fees that were paid in recent acquisitions. He also could not understand why the company was snapping up a trio of bankrupt corporate dogs. His suspicions focused on underworld connections and he himself lay low for fear of mob retribution.
The accusations resulted in the formation of an independent panel to investigate the finances and the truth has now surfaced. There were no payments to the mob, but the inexplicable payments were a method to cover up substantial corporate losses accumulated in the past two decades.
The current leadership claims the skullduggery was the work of former executives who have already resigned.
In view of the fact that the company is regarded as a blue-chip, the scandal provides a black eye to the Japanese corporate image. It is considered the worst blow to Japan Incorporated since Toyota was compelled to recall vehicles for safety defects.