Yamaichi Securities Headquarters, 1 Shingawa, Chuo-ku, Tokyo.
Seated in the president's office, Fukuwa Nobuo, the 65-year-old president of Yamaichi Securities, was flanked by Tanino Sakutaro, the senior managing director, on his left and Murakami Akira, the chief financial officer, on his right.
Fukuwa, a slender man with gold-rimmed glasses, was known for his typically mild demeanor—so much so that he had earned the nickname "The English Gentleman." However, today, his face was rigid with tension.
The atmosphere in the room was heavy, the air thick with silence, until Fukuwa finally exhaled a cloud of white cigarette smoke and spoke.
"How much is this quarter's loss?"
Tanino, seated to his left, hesitated before responding weakly.
"…75 billion yen."
The words had barely left his mouth when Fukuwa's face twisted in rage. His voice exploded through the office.
"Not one or two billion, but seventy-five billion yen?! And you're just saying this to my face like it's nothing?!"
"I… I sincerely apologize…"
Tanino, knowing there was no excuse for such a disaster, bowed his head in shame.
Fukuwa could feel his blood pressure rising to dizzying levels, but he knew that anger alone wouldn't fix the problem. Swallowing his frustration, he forced himself to speak in a calmer tone.
"Is this loss due to the Nikkei futures?"
"Yes. The domestic stock market performed well, and our overseas investments generated significant returns… but we lost $920 million in Nikkei futures, which pushed us into the red."
"Tsk…"
Fukuwa let out a pained groan, then crushed his cigarette irritably into a crystal ashtray.
Losing $920 million in a single futures trade was a staggering blow—even for Yamaichi, one of Japan's Big Four securities firms.
The more he thought about it, the more his blood pressure soared. But in the end, it was he himself who had approved the Nikkei futures short position, so getting angry now would be nothing more than an act of self-sabotage.
Taking a deep breath to compose himself, Fukuwa turned his gaze toward Murakami, the CFO, and spoke in a lowered voice.
"Murakami-kun."
"Yes, sir?"
"I need you to take care of this matter once again."
Murakami, a man with a slightly larger build, wore a troubled expression.
"Are you asking me to conceal the losses as off-the-books liabilities?"
"That's right."
Fukuwa nodded heavily.
Off-the-books liabilities referred to debts that were deliberately omitted from financial records to conceal them.
Murakami, the CFO, looked troubled as he spoke.
"We've already covered up over 100 billion yen in losses through tobashi transactions. If we add another 75 billion yen on top of that, it will be nearly impossible to manage."
Tobashi (飛ばし), meaning "shuffling away," was a common accounting fraud tactic in Japan. It involved selling stocks or bonds that had incurred valuation losses to affiliated companies with different accounting periods at inflated prices—essentially hiding the parent company's losses.
Hit first by the bursting of the bubble economy and then by George Soros's yen attack, Yamaichi Securities had suffered astronomical losses over the past few years.
Under normal circumstances, those losses should have been reported in the company's financial statements. However, Yamaichi had chosen a different path.
With his first term as president nearing its end, Fukuwa had opted to cover up the losses through fraudulent accounting to secure his reappointment.
His reckless foray into Nikkei futures trading was a desperate attempt to quickly erase the hidden financial hole. But instead of narrowing the gap, it had only widened into a catastrophic failure.
Seeing Murakami hesitate, Fukuwa's brows twitched as he snapped impatiently.
"So, are you suggesting we disclose all these losses as they are?!"
"That's not what I meant, but…"
"Next year marks the company's 100th anniversary. Can you even imagine the humiliation of announcing record losses during such a monumental year? What do you think will happen to my reputation?"
Fukuwa kept stressing his own pride and public image, but Murakami couldn't ignore the sheer magnitude of the hidden debts. He was already losing sleep over it.
Then, Fukuwa's sharp gaze locked onto him.
"If I am forced to step down, you won't be keeping your position either. Don't forget that."
He then softened his tone slightly, attempting to coax Murakami instead of pressuring him.
"Look, we've already manipulated the numbers. Adding a little more won't make much difference, will it?"
The sheer audacity of treating such a massive cover-up as if it were a minor adjustment left Murakami speechless. But outwardly, he remained expressionless, pressing his lips into a thin line.
"Just this once, I need you to make it work. If we gradually reduce the liabilities over the coming quarters, no one will ever know."
"Exactly. It's in everyone's best interest," Tanino added, stepping in to apply more pressure.
The weight on Murakami's shoulders grew unbearable.
This wasn't just 10 or 20 billion yen—with the new losses included, they were now looking at nearly 200 billion yen.
How could they possibly keep that hidden without getting caught? No matter how he turned it over in his mind, he couldn't see a way out.
It felt like a quicksand pit—the more he struggled, the deeper he sank.
Yet, Murakami knew there was no turning back.
"If I had never stepped into this mess in the first place, it would be different. But it's far too late to walk away now."
In the world of Japanese finance, there was an unwritten rule:
"Major financial institutions don't go bankrupt."
However, if these losses were exposed, even a giant like Yamaichi Securities would be shaken to its core.
If that happened, Fukuwa would undoubtedly be forced to resign—and as the CFO, Murakami would be next in line to take the fall.
"In fact, I'll probably be punished even more severely than him."
Murakami didn't need anyone to tell him that if things went south, his entire career—everything he had worked so hard to build—would be utterly ruined.
Realizing that he had no other choice, he let out a small sigh, his expression reluctant.
"This is truly the last time."
"Of course. Absolutely."
Fukuwa, who had been waiting for his response, immediately brightened and nodded.
Tanino, the senior managing director, also chimed in, praising him for making the right decision.
But even after deciding to bury another 75 billion yen in off-the-books liabilities, Murakami couldn't shake the grim expression from his face.
Unintended as it may have been, Seok-won's large-scale trading of Nikkei futures had set off a butterfly effect, further inflating a ticking time bomb that Yamaichi Securities had been secretly holding onto.
* * *
Spring Approaches
The sky outside was clear, with not a single cloud in sight, as if signaling the transition from winter to spring.
Seok-won sat at his desk in the executive office, analyzing the movement of three stocks he had recently instructed to purchase.
"Just as expected, they're climbing fast."
All three stocks were showing upward trends, glowing red on the screen.
Particularly, Korea Mobile Communications, which had already been seen as overpriced at 510,000 KRW per share when he bought in, continued to defy expectations and was now approaching 600,000 KRW.
"With this, its position as the second-largest company by market cap is secured. If it gains just 100,000 KRW more, it'll overtake Okwang Industries for the top spot."
While Korea Mobile Communications was soaring on the IT boom, Saseong Electronics, which had attracted massive foreign investment and reached 170,000 KRW per share the previous year, had since plummeted to barely 100,000 KRW, losing nearly half its value.
"With an oversupply of chips and growing concerns over a semiconductor downturn, it's no surprise their stock is struggling."
Watching Saseong Electronics tumble out of the top 10 by market cap, Seok-won muttered to himself.
"This proves that semiconductors are indeed a cyclical industry."
Recalling how Morgan Stanley would later publish reports like The Semiconductor Winter, causing massive stock price fluctuations for Korean chipmakers, he couldn't help but feel bitter.
Just then, his phone vibrated on the desk.
Seok-won reached for it and answered.
[Boss, it's me.]
It was Landon, his voice as energetic as ever. A faint smile appeared on Seok-won's lips.
"What's the occasion?"
[I've got some great news about Blizzard, the gaming company you own.]
"Now I'm curious."
Leaning back in his chair, Seok-won momentarily shifted his gaze away from the monitor.
[The game Diablo, which launched in January, has already sold out its entire initial batch of 200,000 copies.]
"That's fantastic news."
Seok-won responded calmly, as if he had expected nothing less.
Landon chuckled lightly.
[I knew you wouldn't be surprised.]
"Because I knew it would sell well."
Blizzard had initially planned for a small production run of just 50,000 copies of Diablo, fearing that overproducing could leave them stuck with unsold inventory.
It seemed like a reasonable, cautious decision at the time.
However, knowing that Diablo would go on to become 1997's best-selling game, Seok-won pushed hard for a much larger production run—four times the original amount, at 200,000 copies.
Blizzard's executives and developers had been deeply concerned about overproduction, but in the end, Seok-won's instincts had been proven right.
"With great graphics and solid gameplay, it was bound to be a hit."
[Hahaha. If the developers heard that, they'd be thrilled.]
Seok-won smirked and replied,
"Praise isn't given with words—it's given with money. Tell the entire development team they're getting a $10,000 bonus each. And if sales exceed 500,000 copies, they'll receive an additional $100,000 each."
[I can already hear them cheering.]
With his phone pressed to his ear, Seok-won chuckled and asked,
"Production for additional copies has already started, right?"
[Of course.]
"Then have them manufacture 400,000 more units this time."
[That many?]
"It might not even be enough."
[Hmm… Understood. I'll relay the order.]
Landon was slightly concerned—they had already achieved massive success, and yet Seok-won seemed eager for even more.
Still, he followed the instruction without hesitation.
[Oh, and there's one more thing I wanted to mention.]
"Go ahead."
[Starting April 1st, the foreign ownership limit in the Korean stock market will increase to 18%. Would you like to acquire more shares of Donghae Oil?]
"We currently hold 14.6%, correct?"
[That's right.]
Seok-won adjusted his grip on the phone, already having anticipated this moment.
"Set up another shell company and continue acquiring shares up to the new limit."
[Understood.]
After a few more minutes of discussion, Seok-won ended the call and set his phone down, murmuring to himself with satisfaction.
"With results looking this good, I should start pushing the dev team to crank out the expansion pack ASAP."
Sure, he was piling on more work right after they had finished, but with the hefty bonuses he had just promised, they wouldn't have much to complain about.
"Nothing motivates people like money. No doubt about it."
Already excited at the thought of playing the expansion pack himself, Seok-won's face lit up with anticipation.
TL/n -
Yamaichi Securities was one of Japan's "Big Four" securities firms, alongside Nomura, Daiwa, and Nikko. It was founded in 1897 and became a major player in Japan's financial markets.
Yamaichi Securities collapsed in 1997 due to a combination of hidden debts, fraudulent accounting practices, and loss of investor confidence.
Yamaichi had been secretly accumulating massive financial losses for years. Instead of reporting them, the company used tobashi schemes—a practice where losses are temporarily hidden by shifting them to off-the-books accounts or affiliated companies.
During the 1990s, Japan was going through financial turmoil following the burst of its economic bubble. Regulators started tightening oversight, and investigations revealed that Yamaichi had concealed about ¥260 billion (over $2 billion) in losses through illegal accounting methods.