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1. Recommendation Issued
The Securities and Exchange Surveillance Commission(SESC) issued today a
recommendation that the Prime Minister and the Commissioner of the
Financial Services Agency (FSA) take appropriate measures pursuant to
Paragraph 1 of Article 20 of the FSA Establishment Act based upon the
results of the inspection of Okasan Securities Co., Ltd.(hereinafter
referred to as ''the company'')(located in Chuo-ku, Tokyo, Tetsuo Kato,
the president and a managing director; with equity capital of 12.9
billion yen; staffed with approximately 100 employees including
directors) that ascertained the following facts constituting violations
of laws and regulations by the company and its employee.
2. Facts Ascertained
Conclusion of a contract for discretionary trading account transactions
A sales representative of the sales department at the Nagoy branch
office concluded from December 7, 2000 to October 3, 2001,with some
customers many times in connection with the acceptance of orders for the
sale or purchase of stocks, a contract that allowed the employee to make
a decision, without obtaining the customer's consent each time such
transaction was made, as to the distinction, whether to sell or
purchase, selection of the stocks, number of the stocks to be bought or
sold, and price, and actually accepted orders and executed them between
December 8, 2000, and April 5, 2002.
The employee's act of concluding the above contract is acknowledged to
fall under the ''act of concluding a discretionary trading account
transaction contract'' prescribed in Item(5), Paragraph 1 of Article 42
under the Securities Exchange Law.
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