The Securities and Exchange Surveillance Commission on March 23 raided the head office of AIJ Investment Advisors Co. over the loss of nearly all the ¥145.8 billion entrusted to it by corporate pension funds. The SESC must do its best to uncover in detail the entire scope of AIJ's alleged wrongdoings. The Financial Services Agency and other government authorities concerned also should review guidelines for investment advising firms and strengthen their oversight of them.
The SESC said that 84 corporate pension funds had entrusted ¥145.8 billion to AIJ, and that the latter incurred ¥109.2 billion in investment losses. It added that AIJ now has only ¥8.1 billion in cash and deposits, and also has ¥2.1 billion in investments outstanding in overseas funds.
Many problems have surfaced with the AIJ incident. Of the 84 corporate pension funds that had entrusted their assets to AIJ, 73 have been set up by medium-size and small enterprises. It is feared that some of these firms will go bankrupt because they do not have enough funds to make up for the losses caused by AIJ.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.