Toshiba faces ¥12bn legal claim over accounting scandal

JAPAN TRUSTEE SERVICES BANK is suing Toshiba for ¥12bn for losses it made when the Japanese technology company was found to have covered up a $1.3bn accounting scandal last year.

The Japanese trust bank filed a suit with the Tokyo District court on 9 August “on the grounds that damage was incurred due to the company’s inappropriate accounting”, Toshiba said in a statement.

Toshiba said it would set aside “a provision for a reasonably estimable amount, which has not yet been determined”. It will also revise its earnings guidance as necessary.

In May last year a ¥152bn yen (£780m) accounting scandal was uncovered at the 140-year Japanese technology and industrial company. It led to the departure of Toshiba’s chief executive Hisao Tanaka shortly after, and many other executives left in his wake.

The company’s accounting problems stem from company employees understating costs on long-term projects, which allowed Toshiba to overstate operating profits by at least ¥151.8bn ($1.13bn) between 2008 and 2014.

The Japan’s Securities and Exchange Surveillance Commission imposed a record ¥7.37bn fine on the company over the accounting scandal which has severely damaged its reputation.

Since the scandal Toshiba – which makes everything from TVs and PCs to nuclear plants – has cut thousands of jobs.