Japan arrested and sued SMBC Nikko Securities authorities on suspicion of market manipulation

Tokyo — Japan’s SMBC Nikko Securities said Thursday that executives had been arrested and charged on suspicion of market manipulation following charges from the state’s financial oversight agency.

Sumitomo Mitsui Financial Group’s securities company said in a statement that it could not deny the error in the internal control system because it allowed the prosecutor in Tokyo to accuse employees and the company itself.

The company did not appoint an executive, but the Nikkei newspaper reported that Vice President Toshihiro Sato was arrested and five others were indicted.

SMBC Nikko Securities previously told Reuters that although it was not possible to ask Mr. Sato for comment, he is still collecting all the facts.

The Securities and Exchange Surveillance Commission of Japan has sought prosecution against seven employees and SMBC Nikko Securities.

On Wednesday, Watchdog said the brokerage firm bought stock through proprietary trading, pushing up prices and preventing block trade transactions from failing.