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.