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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Michael Woodford: the man who blew whistle on £1bn fraud

Category : Business

Former Olympus chief executive tells of risks he ran in exposing fraud scandal at the digital camera company

“This is humbling. It’s a long way from a private jet,” Michael Woodford shouts out as he charges across five lanes of traffic and into the underground at Euston Square.

In a previous life as the boss of one of Japan’s biggest companies, Woodford was used to being served champagne at 33,000ft as a stewardess put slippers on his feet. But that was a very different life again from the one Woodford was born into, in a “sink estate in Liverpool”.

As well as having a difficult upbringing in a “shoebox”-sized home, Woodford was bullied for being both Jewish and Chinese – he is neither, but he went to the King David Jewish school and has a slightly oriental appearance from Tamil ancestry.

“To get home you had to walk past the two big rough comprehensives, and they’d see my school blazer and yellow and black tie and they’d say, ‘Are you a yid, lad?’

“I would say, ‘No, I’m a gentile,’ but they couldn’t understand that, which would always irritate them and I’d get pushed around. Another day I’d come back and they’d say, ‘Are you a chink, lad?’. I’d say, ‘No I’m English,’ and they’d say, ‘Ah, two number 16s.’ They thought they were hilarious.”

Despite the bullying, Woodford, 52, is still in touch with many friends from his formative years in Liverpool and Southend. But he says you will never catch him boasting about the private jet that would whisk him from the modest Southend home he has lived in for 30 years to Paris for the overnight first-class flight to Tokyo, or his £2.75m to £3m a year salary. “My friends aren’t businessmen, they’re artists and teachers, that sort of thing,” he says. “If I went on about things like that, they would think I was a tosser.”

While he always tried to stay grounded as he climbed the corporate ladder at Olympus over three decades, it’s tough, he says, to break ties with the luxury lifestyle. “I don’t like travelling economy on long-haul flights. All that pampering over the years has obviously got to me – so it’s always business class,” he says as he relaxes into the leather seats of the first-class carriage from Paddington to Oxford for the latest in a series of public speaking engagements.

Woodford joined Olympus’s British subsidiary Keymed as a salesman in 1980 and rose to become managing director of the division before he was 30, then went on to become head of Olympus in Europe before being called to the top job in Japan. “But, you know, I don’t live on a yacht or do silly things.”

It’s not as if he can’t afford to be a little silly. Earlier this year he collected a £10m settlement over his dismissal for blowing the whistle on a £1bn fraud scandal at the endoscope and digital camera company.

“It must make you feel sick, interviewing people earning all this money,” he says. “I’m quite leftwing, you know. I could be a communist, if that worked any better than capitalism.”

Some of his beliefs would go down well with Marx and Lenin. His kids won’t be getting any of the £10m. “If I’m struck down now, they won’t get a penny,” he says. “Rather than being posh little rich kids, they’re going to go out there and earn it on their own.” Edward, 19, and Isabel, 17, were sent to state grammar schools until he left for Tokyo, when Isabel was sent to a private boarding school – “she would have had to be sedated and handcuffed to go [to Tokyo]” – where, Woodford says, she’s educating her classmates.

“Isabel told me the other day that some of her friends at school were saying taxation is wrong – not the level of taxation [but the fact that it exists]. She told them that that’s what pays for the hospitals and the schools for other kids who can’t afford to go to nice little rich schools.”

His money will go to charity, predominantly those campaigning for human rights, such as Clive Stafford-Smith’s Reprieve, and road safety foundations.

Noting the irony that he had just run across one of London’s busiest junctions, he says, “But we looked both ways, right? And we were late. Being late in Japan is just about the rudest thing you can do. The contents of a meeting [in Japan] don’t matter as long as you arrive on time.”

Woodford says Japan’s obsession with politeness and social niceties is partly to blame for the country’s fall from the top of the global power tree and the fraud that almost destroyed the 93-year-old Japanese electronics company.

“There is a disaster in Japan because of these social characteristics – the deference, not being able to question people in authority,” he says. It was this attitude, he continues, that almost allowed Olympus’s previous bosses to cover up more than £1bn of fraud.

He first got wind of the claims just weeks after taking over as chief executive – the first foreigner, or gaijin, to run the company, and only the fourth at any major Japanese company – when a friend emailed him a translation of “amazingly detailed” claims published in Facta, a local magazine with a campaigning remit similar to Private Eye.

“When I got to the office I expected everyone to be talking about it. But no one mentioned it.” By lunchtime he summoned two of his most trusted colleagues and ask them if they had read it. They had, but said that Tsuyoshi Kikukawa, Olympus’s previous CEO and then chairman, had “told them not to tell me”. Eventually Woodford demanded a meeting with Kikukawa and Hisashi Mori, then deputy president and “Kikukawa’s permanent sidekick”.

The table for the lunchtime meeting was set out with the “most wonderful selection of sushi, but in front of my place was a tuna sandwich”, Woodford, a committed sushi fan, told students at Saïd business school in Oxford later that evening. “It wasn’t just any tuna sandwich – it was a tuna sandwich that would have made British Rail in 1981 proud. It was that manky. The tuna sandwich was to tell me my place in life.

“That’s when it really blew up, and the shit hit the fan,” he said, before pausing hand over mouth in mock horror that he might have committed another terrible faux pas on top of arriving half an hour late for his own talk. “Can you say that at Oxford?”

Although Woodford tried to embarrass Mori into talking to him by following him into the urinals and shouting at him eyeball to eyeball, Mori and Kikukawa refused to explain why Olympus had spent almost £1bn buying three “Mickey Mouse” companies and paid $687m for mergers and acquisitions (M&A) advice on the deal. “It was the largest payment ever made for M&A advice in the history of capitalism by a factor of three,” Woodford says. Forensic accountants traced the money to London, from where it “went to the Cayman Islands and disappeared”.

When the next edition of Facta was published, it claimed the fraud was linked to “antisocial forces” – code for the Yakuza, the Japanese mafia. “I was scared. Even telling you now I can feel myself shaking and feel my hands going cold, soon my feet will go cold too,” he says. “I started to think what was going to happen to me. My fate could have been, ‘Michael has been under a lot of stress, he’s been drinking and taking sleeping pills. He jumped off the top of a building.’ That’s what happens in Japan.”

At home, his wife, Nuncy, (“she’s Spanish, Latin-tempered and very bossy”) was having constant nightmares. And it was about to get worse. Woodford called a meeting of the whole Olympus board to discuss the crisis, but Kikukawa had changed the agenda. “This meeting is to vote on the dismissal of Michael Woodford as CEO,” Woodford heard via simultaneous translation in his headset. “As he said the O, all the directors put their arms up. They couldn’t have put them up higher.”

The next word was from Kikukawa. “‘Mr Woodford cannot speak on this matter because he has a conflict of interest.’ It was an eight-minute corporate execution.”

He was forced to give up his apartment and take the bus to the airport, but Woodford wouldn’t acquiesce to Mori’s demands to hand over his iPhone. “I got in his face. ‘Are you going to take it off me? My wife will be phoning, she’ll be worried,’” he says. “Mr Mori didn’t know I’d grown up in Liverpool.”

Within hours he had given all the details to the press and the police. Kikukawa and Mori eventually resigned, but even then the rest of the board and institutional shareholders failed to support his bid to be reinstated as CEO.

“It is like a John Grisham novel. But it’s true.”

Exposure: Inside the Olympus Scandal – How I Went from CEO to Whistleblower (Portfolio Penguin) is published on 29 November. Available for £16 from

‘Public’ debate which most people can’t understand creates a canyon of rage

Category : Business

Mark Thompson is right: some journalism might as well be in Sanskrit

Mark Thompson, heading for white-collar management life on the New York Times, is still a journalist at heart – and a formidably talented one. Just read his three Oxford lectures last week on the snarling, short-cutting, crudely over-simplified language of modern public debate – a canyon of ignorance and rage that runs down Fifth Avenue just as it swills outside Broadcasting House. This “manager” can think and write as thoughtfully as those great NYT gurus who do it for a living. But sometimes it’s not the outer extrapolations of theory that make you wince most pitifully, rather the facts from which they flow.

“Public incomprehension and distrust are measurable,” said the departed director general. “One of our recent BBC surveys found that only 16% of those questioned felt confident about defining the term ‘inflation’. For GDP the number was 10%; liquidity 7%. As for credit default swaps, CDOs, QE, Tarp and the EFSF, those questions weren’t asked, but would have presumably been off the scale.

“For most lay people, much of the theoretically ‘public’ debate about the economic discourse might as well be in Sanskrit. Ipsos MORI have defined what they call ‘a presumption of complexity’ among a significant portion of the public, a sense in advance that certain public policy issues are so hard to that there’s little point trying.”

Rage, in non-complex short, can simply mean not knowing what the hell you’re talking about.

Gemba puts faith in ex-PM Mori’s ability to resolve Japan-Russia isle issue

Category : World News

Japanese Foreign Minister Koichiro Gemba expressed hope Saturday that former Prime Minister Yoshiro Mori will play a role in negotiations with Russia on the long-standing territorial dispute between the two countries.
Gemba told reporters traveling with him in Morocco that Mori “is the only person in (Japan’s) current political circles who is acquainted with” Vladimir Putin, who is set to return to the Russian presidential post Monday.

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Ozawa loyalists quit key government, DPJ posts to protest Noda’s tax hike push

Category : World News

Four senior lawmakers close to Democratic Party of Japan kingpin Ichiro Ozawa resigned from their government posts Friday in protest after Prime Minister Yoshihiko Noda submitted a contentious bill to the Diet to raise the sales tax.
Senior vice health minister Yoshio Maki, state secretary for internal affairs Toru Kikawada, senior vice education minister Yuko Mori and vice internal affairs minister Ryo Shuhama all tendered letters of resignation after Noda’s Cabinet approved the legislation earlier in the day.

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Real estate magnate Mori dies

Category : World News

Minoru Mori, founder and chairman of Mori Building Co., Japan’s biggest closely held developer, has died. He was 77.
Mori died of heart failure on Thursday, according to an emailed statement sent by the Tokyo-based company Monday.

More here: Real estate magnate Mori dies

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