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Olympus Sues, But Retains, Executives Over Scandal

Olympus executives hid nearly $1.7 billion in losses for years.

The story about Olympus' massive effort to cover $1.7 billion in losses is taking another turn, The New York Times reports, but it may not be the one that many observers would expect.

The scandal - which started in the 1990s - is a case study in how

The story about Olympus' massive effort to cover $1.7 billion in losses is taking another turn, The New York Times reports, but it may not be the one that many observers would expect.

The scandal - which started in the 1990s - is a case study in how corporate governance can fail, especially considering how Olympus decided that although it will be suing 19 people who once or currently are executives or board members, no one will immediately lose their jobs.

One of the officials involved, sitting president Shuichi Takayama, will be sued for approximately $6.5 million, the newspaper says, charged with failing "to meet his fiduciary duties as a director while the fraud was under way."

Critics says that it's a bad idea to let those involved in the scandal stay on to oversee the transfer, since that could enable them to "name their successors and subvert meaningful changes in the management and accounting oversight of the company," the source adds.

In an interview with the BBC, the former Olympus CEO Michael Woodford - fired when he tried to blow the whistle - said letting the executives and board members linger could undermine corporate governance in Japan, and called for a new board of fresh members divorced from the cover-up.

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