Soka University in Japan trains students for government employment exams and touts their success. Might a presence of followers in the civil service be of more than spiritual use to Soka Gakkai? Consider this case from the files of the Tokyo civil courts.
In 1995 Akiyo Asaki, a politician in the Tokyo suburb of Higashi Murayama, complained vociferously that all city garbage collection contracts were going to Soka Gakkai-affiliated companies.
After receiving death threats, Asaki plunged off a building. When police arrived at the scene, they recognized her and, even though she was still alive, kept her from getting medical help, according to her daughter, Naoko Asaki. She says that when her mother died, the police tried to have her body immediately cremated.
The prosecutor’s initial investigator, Masao Nobuta, and the officer in charge of assigning him, Hiroshi Yoshimura, were both members of the sect. They said Asaki’s death was a suicide and linked it to her being questioned about the shoplifting of an item of women’s clothing.
This explanation, seized on by Soka to counter her family’s accusations of murder, became the focal point of a civil court crossfire of defamation cases, several won by Soka. Autopsy evidence, allegedly withheld by police, was presented to show large bruises under her arms, suggesting she had been dragged. Naoko Asaki maintains her mother had left a phone message in a tense, fearful voice before she died. One court ruled inconclusively on a suicide. Soka spokesmen say the religious affiliation of the investigators in the case was a random circumstance and that, in any case, others reviewed their work.
Probes of the death petered out after Soka’s Komeito party joined a coalition government in Tokyo. Naoko Asaki is cynical: “Do you think a government that depends on Soka Gakkai is going to investigate?”
Copyright © 2004 Forbes.com
Rocket Returns To Earth Orbit
Man loses $38 billion: a case study in what makes stocks go up and then go down.
YASUMITSU SHIGETA WAS, AT OUR last report (see story) , the world’s fifth-richest man. This was by dint of the frenzied ride of the stock of Hikari Tsushin, the Japanese mobile phone sales company of which he owns 60%. At their peak in February, shares traded at $2,300, or 720 times earnings. Shigeta’s stake then: $42 billion.
What the momentum traders can send up in a hurry they can send down in a hurry. By late April the stock had sunk to $188 and the poor fellow was down to his last $3.5 billion.
Hikari’s fall was just one of the messiest in a recent across-the-board stampede out of Japanese Internet stocks. As Hikari’s stock crashed, Tokyo abounded with fantastic rumors—that the company would be investigated for insider trading, that gangsters had an “in,” even that Shigeta had died.
The reality was more prosaic. The stock was bought by small investment funds early in 1999. They were followed in turn by more mainstream funds, then by Japanese individual investors and finally by Japanese investment trusts. The effect of all this cash on a medium-size company with only 12% of its shares trading was a spectacular rise. At a certain point there was no one left to buy. The stock began to plunge on increasingly frantic profit-taking and stop-loss selling as the herd changed direction.
The process was accelerated by a gaffe on Shigeta’s part. In an effort to stanch the price erosion, he told investors in March his company’s business was going to meet its aftertax profit target for the year. Two weeks later the company announced its first-ever operating loss, $120 million, instead of a predicted profit of $60 million. Profit from sales of outside holdings lifted the aftertax profit to the target level, but that did nothing to soothe furious investors.
Hikari’s operating loss was indeed bad news: Its mobile companies have begun losing market share to giant NTT Docomo this year. Also, Hikari expanded too quickly, opening the franchise to shaky and/or disreputable operators. Irrational exuberance, it would seem, was not limited in this case to outside investors. However, Hikari quickly reacted by shuttering 600 unprofitable shops. “I have had to change my focus from growth to consolidation and quality control,” Shigeta says.
All is not lost. Hikari has passed giant NTT to become the fastest-growing provider of Internet domains, e-mail accounts and servers to small businesses. The company is sitting (post crash) on $3 billion in unrealized profits from its Internet investments around the world. The share price is now, at 59 times expected earnings, at a level where it might have appeal outside the momentum herd. And Shigeta, still alive at 35, is young enough to make back a few billion.