Ex-Nova boss gets 3 1/2 yrs for embezzlement

The former president of failed language school chain Nova Corp. was sentenced Wednesday to 3-1/2 years in prison for professional embezzlement involving misuse of the reserve funds of an employees mutual aid organization.

In the ruling given at the Osaka District Court, presiding Judge Hiroaki Higuchi said Nozomu Sahashi, 57, decided management strategies as the founder of Nova and that there was no room for leniency concerning his use of the reserve funds, which were not operational funds, to improve the firm’s financial situation.

The firm is now undergoing bankruptcy proceedings.

The judge also said, “He had no prospects of repaying the money, and he bore grave criminal responsibility.”

Prosecutors had demanded five years’ imprisonment for Sahashi.

According to the ruling, in July 2007, Sahashi, acting in conspiracy with a 50-year-old Nova executive in charge of finance, had about 320 million yen transferred from the funds to a bank account of a Nova affiliate to be used to refund prepaid tuitions to former students.

In the ruling, the judge said: “The executive [in charge of finance] confirmed in advance with Sahashi that the funds were not operational funds. Sahashi misused the funds knowing that the employees wouldn’t approve.”

He also said: “It’s not unreasonable that he wanted to help Nova survive. He also apologized. But he used the employees’ funds to help the firm out of its management problems. There’s no room for leniency.”

http://www.yomiuri.co.jp/dy/national/20090827TDY01303.htm

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