A group of 24 former students of failed language school operator Nova Corp. lodged a suit for damages Friday against former Nova management and two audit companies, seeking a total of 16 million yen in compensation to cover prepaid tuition.
It was the first time that former Nova students have filed a class action suit since the company went bankrupt last year, lawyers for the plaintiffs said after filing the suit with the Osaka District Court.
They claimed that former President Nozomu Sahashi and other Nova management led the company to bankruptcy after employing illicit accounting procedures and business practices to expand its operations. Sahashi, 57, was indicted in July on charges of embezzlement.
The plaintiffs — including students and company employees in Osaka, Kyoto, Hyogo, Nara, Ehime and Miyazaki prefectures — also accused the audit companies of allowing the Nova management to continue such unlawful practices, according to the complaint.
Some condemned the management for failing to reimburse tuition fees even after canceling their contracts.
“We would like to help former students by pressing charges against Nova over its reckless business practices,” lawyer Takanori Ozaki said at a news conference.
Nova
Nova head avoids fresh indictment
The Osaka District Public Prosecutor’s Office announced Tuesday it will not indict the former president of Nova Corp. for failing to pay the salaries of non-Japanese teachers and Japanese personnel.
Nozomu Sahashi, 56, is already under indictment for embezzling ¥320 million from reserve funds for corporate workers at the failed foreign-language school chain.
Nova chief indicted for embezzling firm’s funds
Nozomu Sahashi, former president of the bankrupt Nova Corp. language-school chain, was indicted Tuesday for embezzling corporate funds, prosecutors said.
Sahashi, 56, allegedly diverted around ¥320 million from an employment benefit fund last July 20 to reimburse tuition fees for people who canceled their contracts for language courses.
Sahashi has admitted to the allegations, changing his previous stance that he had believed that part of the funds could be used for the company’s operations, according to investigative sources.
Nova’s Sahashi indicted over fund
Nozomu Sahashi, former president of failed language school chain Nova Corp., was indicted Tuesday by the Osaka District Public Prosecutors Office, on charges of misusing 320 million yen from an employees’ mutual aid group fund to refund student fees.
The prosecutors decided to stop pursuing attempts to indict Toshihiko Murata, who was the president of Nova affiliate Nova Kikaku at the time of the alleged offense, after concluding his involvement was purely on a subordinate level.
According to sources close to the investigation, Sahashi was the chairman of Shayukai, a mutual aid group of Nova employees that deducted money from members’ salaries to create an employee welfare fund.
Papers sent on Nova, ex-president over wages
The Osaka Labor Bureau sent papers to prosecutors Monday on failed English language school operator Nova Corp. and its former president, Nozomu Sahashi, on suspicion of violating the Labor Standards Law for failing to pay wages to Nova workers.
According to the bureau, Sahashi, 56, is suspected of failing to pay 105 million yen in wages to 400 Nova workers.
Among the 400, 134 were Japanese staffers who did not receive salaries for September, totaling 33 million yen, and 266 were foreign instructors who received no wages for October, totaling 72 million yen.
Sahashi has claimed his failing to pay wages is not a violation of the law. He was quoted by labor officials as saying, “I feel responsible as the [former] president of the company, but I did what I could do, like putting my own money into the business.”
Osaka Labor Bureau reports Nova Corp., ex-President Sahashi to prosecutors
Labor authorities have reported former Nova Corp. President Nozomu Sahashi and the English language school chain to public prosecutors for failing to pay their employees.
The Osaka Labor Bureau sent documents to the Osaka District Public Prosecutors Office on Monday accusing Sahashi, 56, and Nova Corp. of breaking Labor Standards Law.
According to the labor bureau, Nova Corp. failed to pay about 105 million yen in wages to 400 foreign instructors and Japanese employees at the school.
The amount and the number of victims are a record high for a case of unpaid regular wages, excluding overtime-work wages and severance payment.
Sahashi has admitted to not having paid the wages, but denies that he did it deliberately.
“I was busy raising money using my personal funds,” he told police.
According to police, in 2007 Sahashi failed to pay about 33 million yen in wages to 134 Japanese employees on Sept. 27, and around 72 million yen to 266 foreign instructors on Oct. 15.
Sahashi has already been arrested for embezzlement in the conduct of business for allegedly misappropriating a massive sum from the employees’ welfare fund.
http://mdn.mainichi.jp/national/news/20080701p2a00m0na019000c.html
Nova ex-president Sahashi says he was solely responsible for embezzlement
Disgraced former Nova Corp. President Nozomu Sahashi has admitted that he was solely responsible for misappropriating money from the coffers of an employees’ welfare fund, police sources said.
Sahashi, 56, who was arrested for embezzlement in the conduct of business after he was found to have misappropriated about 320 million yen pooled in a Nova employees’ mutual aid fund, had initially denied part of the allegations. However, he later told police, “I instructed everything,” admitting to the charges.
Osaka Prefectural Police also found that Sahashi was keeping track once a month of the remaining amount of money in the account of Shayukai — the mutual aid society of Nova employees — by having the amount reported to him. Police will further question Sahashi over the case, suspecting that he misused the money pooled in the Nova employees’ welfare fund for his own use.
In July last year, Sahashi allegedly transferred about 320 million yen from the Shayukai account into an account of Nova Kikaku, an affiliate of Nova. The money was later transferred to a Nova account. Investigators suspect that Sahashi attempted to launder money by transferring the funds.
In a related development, investigators suspect that Sahashi had also previously misappropriated money from the employees’ fund. In around 2005, he used about 10 million yen from the fund for the medical treatment of a Nova board member who was hospitalized at the time, as well as a total of several millions of yen for a year-end party and other expenses, police said.
http://mdn.mainichi.jp/national/news/20080627p2a00m0na009000c.html
NOVA funds recorded as loan to president
Reserve funds for employees of failed language school chain Nova Corp. that had been transferred into an account for refunding student fees were recorded as a loan to its former president, Nozomu Sahashi, who is under arrest for misappropriating the funds, police said Wednesday.
The Osaka prefectural police believe Sahashi instructed a Nova accountant to falsify the purpose of the transfer as being “to cover refunds for students who cancelled their enrollment before finishing all programs” so he would not be blamed for the misuse of the funds.
The accountant recorded in a ledger for the reserve funds that the money was loaned to Sahashi from the mutual aid association.
However, there was no document to certify that the money was loaned by contract to Sahashi by the association.
At that time, Sahashi had personal assets, including bank accounts and property, worth several hundred millions of yen. The police believe he had no intention of repaying the money to the association.
[Nozomu] Sahashi and [Toshihiko] Murata [former deputy manager of Nova’s accounting department who was also arrested on a similar charge] were sent to the prosecutors office on Wednesday afternoon. The police will continue searching locations related to the suspects.
1 billion yen unaccounted for at Nova
About 1 billion yen is accounted for at Nova Corp., the failed operator of a large foreign language school chain, sources close to the firm said.
Osaka Prefectural Police are investigating how the money has been used.
Nova’s records show that approximately 700 million yen was withdrawn from one of the company’s accounts in early August last year, according to the sources. The document does not specify how the money was spent.
Roughly 1.4 billion yen was placed into the same account in September last year. However, some 1.7 billion yen was later withdrawn in the same month under the pretext of “Sahashi, temporary payment,” an apparent reference to payment made by then Nova President Nozomu Sahashi, say the sources.
The source of the 1.4 billion yen, or how the 1.7 billion yen was used, remains unknown.
http://mdn.mainichi.jp/national/news/20080626p2a00m0na017000c.html
Police say ex-Nova boss hoarded riches on brink of bust
Disgraced former Nova Corp. President Nozomu Sahashi was in possession of a large amount of personal assets when the English conversation school was on the brink of collapse, police said.
Sahashi, 56, from Osaka, was arrested on Tuesday on charges of embezzlement in the conduct of business after he was found to have used about 320 million yen that had been pooled in Nova employees’ mutual aid society. Sahashi has reportedly denied part of the allegations.
Investigators found on Tuesday that Sahashi had had hundreds of millions of yen worth of personal assets in the forms of cash and real estate when he allegedly misappropriated the massive sum from the employees’ welfare fund by transferring the money into a Nova account in July last year.
In a related development, police also arrested Toshihiko Murata, 49, former president of a Nova affiliate called Nova Kikaku, on charges of embezzlement in the conduct of business.
Murata, who was reputed to be Sahashi’s right-hand man, has reportedly admitted to the allegations. He had assisted Sahashi mainly in accounting since around 1990.
Investigators have also raided a building in Osaka’s Chuo-ku, where Nova Kikaku’s headquarters was based.
http://mdn.mainichi.jp/national/news/20080625p2a00m0na006000c.html