Five former officials from SMBC Nikko Securities are found guilty of market manipulation charges
The Tokyo District Court has handed down a guilty verdict against five former senior officials of SMBC Nikko Securities Inc. on July 22, 2025, in a stock price manipulation case that spanned from 2019 to 2021. The defendants, including Makoto Yamada, former head of the equity division, Toshihiro Sato, former deputy company chief, Trevor Hill, former Senior Managing Executive Officer, Alexandre Avakiants, former executive officer, and Shinichiro Okazaki, former division head, were found guilty of violating the financial instruments and exchange law [1][2][3].
The court convicted the defendants for placing massive buy orders on 10 stocks before conducting block offer transactions, an act that artificially supported stock prices [1][2]. The details of the penalties or fines for the guilty parties were not specified in the report.
In a surprising turn of events, both Yamada and Sato pleaded not guilty during the trial. However, both SMBC Nikko and the former company executive had admitted to the charges in February 2023 [1][2]. The court recognized collusion between them and the five defendants.
Sentencing for the convicted officials was as follows:
- Makoto Yamada received a prison sentence of three years, suspended for five years.
- Toshihiro Sato and Trevor Hill were each sentenced to two years and six months, suspended for five years.
- Alexandre Avakiants was sentenced to one year and six months, suspended for three years.
- Shinichiro Okazaki received a two-year prison sentence, suspended for four years [1][2].
Notably, Shinichiro Okazaki has announced plans to appeal the verdict [5].
This case has significant implications for foreign professionals working in Japan, as it underscores the legal risks they may face. The scandal has also had substantial business and reputational impacts on SMBC Nikko Securities, resulting in losses and cost-cutting measures after the scandal became public [4].
Block offer transactions, where brokerage firms buy shares from major shareholders to sell to investors outside the market, were used in this case to manipulate stock prices. This practice is a violation of the financial instruments and exchange law, as the court has now confirmed.
[1] Nikkei Asia, (2025), Tokyo court finds SMBC Nikko executives guilty of stock price manipulation. Retrieved from https://asia.nikkei.com/Business/Companies/Tokyo-court-finds-SMBC-Nikko-executives-guilty-of-stock-price-manipulation
[2] The Japan Times, (2025), SMBC Nikko executives found guilty in stock price manipulation case. Retrieved from https://www.japantimes.co.jp/news/2025/07/22/business/smbc-nikko-executives-stock-price-manipulation-case/
[3] The Wall Street Journal, (2025), Tokyo Court Finds SMBC Nikko Executives Guilty in Stock Price Manipulation Case. Retrieved from https://www.wsj.com/articles/tokyo-court-finds-smbc-nikko-executives-guilty-in-stock-price-manipulation-case-11661817368
[4] The Financial Times, (2023), SMBC Nikko Securities faces business and reputational impacts after stock price manipulation scandal. Retrieved from https://www.ft.com/content/699f190c-8d7f-49e0-8e9d-6f48f5298267
[5] Bloomberg, (2025), SMBC Nikko Executive Plans to Appeal Guilty Verdict in Stock Price Manipulation Case. Retrieved from https://www.bloomberg.com/news/articles/2025-07-24/smbc-nikko-executive-plans-to-appeal-guilty-verdict-in-stock-price-manipulation-case
- The verdict against the five former SMBC Nikko Securities officials could serve as a reminder for foreign professionals in Japan about the potential legal risks they may face in business-related misconduct, such as sharing news about the guilty verdict in general-news articles or social media posts about finance and crime-and-justice.
- In light of the stock price manipulation case involving former SMBC Nikko Securities executives, it is essential to reconsider the practice of sharing photos or details of business deals, especially those involving block offer transactions, to maintain a transparent and honest business environment.
- The guilty verdict against the former SMBC Nikko executives sheds light on the importance of adhering to the financial instruments and exchange law, and this case can serve as a cautionary tale for corporate executives not to engage in activities that manipulate stock prices, such as misleading shareholders or the public about business partnerships through social media or other platforms.
