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Olympus Accounting Scandal Continues With Arrests

Former and current Olympus officials have been arrested as part of an accounti

The decade-long cover-up in Olympus' corporate accounting has blown up into a huge scandal embroiling some of the company's top former and existing executives. That scandal played out more Thursday, as Japanese

The decade-long cover-up in Olympus' corporate accounting has blown up into a huge scandal embroiling some of the company's top former and existing executives. That scandal played out more Thursday, as Japanese authorities took seven of the main players into custody.

According to The New York Times, the arrests of former Olympus chairman and president Tsuyoshi Kikukawa and two others came under charges that they had falsified financial statements, while two investment bankers and two of their business associates were also taken in.

The developments have cast doubt over the strength of corporate governance in Japan, and the company is currently under investigation in the U.S. and the U.K. as well, the Times reports.

However, observers comment that the cases are unlikely to hurt Olympus' business prospects. A sell-side equity manager at a Japanese firm, who did not want to be identified by name, told Reuters that its potential deals with Fujifilm, Terumo, Sony and other companies wouldn't be affected.

"Olympus continues to be very attractive to other companies because of its endoscope business," he said.

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