Disgraced Toshiba CEO Hisao Tanaka Resigns Under Cloud Of $1.2B Accounting Scandal

Toshiba president and CEO Hisao Tanaka and several company board members have resigned following an investigation that revealed that the Japanese firm reported more than a billion dollars in fake profits over the past seven years. In the wake of the scandal, Toshiba said it would adjust earnings by at least 151.8 billion yen (around $1.2 billion in U.S. currency).

"The company takes the situation it has caused very seriously and we deeply apologize to our shareholders, investors, and all other stakeholders," Toshiba said in a statement (PDF). "The company will thoroughly analyze and examine the investigation results and recommendations received from the Independent Investigation Committee, and reflect them in our management practices, as well as examine measures to prevent recurrences."

Toshiba

Toshiba also asked for "ongoing support" while acknowledging that it must win back the trust of shareholders and everyone else involved with the firm. And in a show of support, Toshiba's stock price is up more than 6 percent today after falling around 20 percent since early April when the accounting irregularities were first reported.

This all started when Toshiba began looking into accounting discrepancies in its energy division. What it found prompted the company to get an independent committee involved. It also cancelled its year-end dividend and postponed earnings.

Mr. Tanaka has been with Toshiba since 1973. He joined the Japanese firm one month after graduating from Kobe University of Commerce with a Bachelor Degree of Economics. He's held a number of high ranking positions within Toshiba over the years, most recent as Director, Representative Executive Officer, President, and CEO.

In addition to Tanaka resigning, eight board members have stepped down in light of the scandal, including Vice Chairman Norio Sasaki. Current chairman Masashi Muromachi was named interim president.

Via:  CNN Money
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