U.S. regulators sanctioned a former Molex Inc. accounting executive over claims he racked up more than $110 million in losses through unauthorized trading over the course of more than 20 years.
Katsuichi Fusamae, working at subsidiary Molex Japan Co., traded in the company’s brokerage account from at least 1989 through 2010 and concealed losses by taking out undisclosed company loans, the Securities and Exchange Commission said in a statement Thursday. To settle the claims, Fusamae agreed to a permanent bar from serving as an officer or director of a publicly-traded company.
Molex restated its earnings in 2010, recognizing $201.9 million in cumulative losses, which included both trading losses and borrowing costs from the unauthorized loans. The Lisle, Illinois-based company, which was bought in 2013 by Koch Industries Inc., failed to maintain sufficient internal accounting controls, the SEC said.
“Fusamae took advantage of internal control weaknesses at Molex to falsify records, monopolize the flow of information from banks and broker-dealers, and circumvent external and internal audit processes,” Timothy Warren, associate director at SEC’s regional office in Chicago, said in the statement. “His actions left Molex shareholders in the dark about the company’s true financial condition.”
Matt Kipp, an attorney for Molex at law firm Skadden Arps, didn’t immediately respond to a phone call seeking comment. Fusamae has no known defense counsel, according to the SEC, and contact details weren’t immediately available.