Toshiba to face $60 mln fine over profit overstating scandal

PanARMENIAN.Net - Troubled Japanese tech giant Toshiba could face a record fine of $60 million for its multi-billion dollar accounting scandal, BBC News reports.

The fine was recommended by the Securities and Exchange Surveillance Commission (SESC) to the Financial Services Agency, which imposes penalties for such violations.

It stems from the company overstating its profits by $1.3bln over seven years.

The proposed fine would be the largest in Japan for accounting violations, according to the BBC.

It exceeds the 1.6bln yen fine on industrial conglomerate IHI in 2008 for similar violations.

The fine still needs to be approved by the Financial Services Agency, but it tends to back the SESC's recommendations.

The move was widely expected after Toshiba said it had put aside 8.4bn yen to pay for potential fines.

The recommendation also comes on the same day as a lawsuit by 50 individual shareholders, who are seeking $2.45m in damages from Toshiba after its stock plunged following the accounting scandal, BBC says.

The lawsuit filed in Toyko was against the firm itself, along with three former chief executives and two finance chiefs.

In July, its chief executive, president and six other high-level executives resigned from the company over the scheme to inflate profits over several years.

The company's stock has plunged more than 40% since April, when reports of irregularities in its accounting practices began to surface.

In its latest earnings report in September, the electronics maker posted a net loss in the first quarter and its sales fell to their lowest level in two-and-a-half years.