Nova chief’s sentence shortened

The Osaka High Court on Thursday shaved 18 months off the 3 1/2-year prison term of the founder and former president of Nova Corp., who was convicted of embezzling ¥320 million from the defunct English school chain’s employee benefit fund.

The counsel for Nozomu Sahashi, 59, plans to appeal.

Sahashi pleaded not guilty at his Osaka District Court trial and claimed the funds were diverted in an attempt to help the company, not for his personal benefit as charged.

Presiding Judge Sumio Matoba, however, upheld the verdict because the entity in charge of the funds was set up for the welfare of the employees and was thus separate from Nova by nature, ruling Sahashi inflicted damage on that entity.

Sahashi transferred all the funds in the entity to the bank account of a Nova subsidiary in July 2007 to reimburse a flood of students who had decided to cancel their lesson contracts over an advertising dispute.

But the judge shortened Sahashi’s sentence in recognition that his embezzlement was aimed at keeping the company afloat during the management crisis, and that his crime could be construed as containing a beneficial aspect for the employees.

Sahashi launched English conversation classes in Osaka in 1981 and set up Nova in 1990. His venture grew into Japan’s largest English school chain, boasting an enrollment of some 480,000 at its peak.