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Japan internet boss trial begins Livedoor's Horie pleads innocence
(20 minutes later)
One of Japan's best-known businessmen has pleaded not guilty to charges of financial crime. Takafumi Horie, former boss of Japanese internet firm Livedoor who quit amid a corporate scandal, has pleaded not guilty to fraud charges in court.
The flamboyant 33-year-old entrepreneur Takafumi Horie is accused of inflating the profits of his internet company Livedoor by nearly $50m (£26m). Mr Horie denied violating securities laws by falsifying profit figures to boost Livedoor's share price.
Mr Horie had risen to become a media star and political celebrity as head of the company, but stepped down when he was arrested earlier this year. The 33-year old faces a maximum of five years in jail if found guilty.
No verdict is expected in the case until next year. Mr Horie's fall from grace sent shockwaves through the Japanese stock market, leading to a sharp fall in share prices earlier this year.
Prosecutors say Mr Horie he committed securities fraud by grossly exaggerating the profits of his firm, Livedoor. The case against Mr Horie has attracted widespread public interest because his brash, aggressive manner was at odds with Japan's traditionally conservative business culture.
Dressed in a black suit and blue tie, Mr Horie gave a broad smile as he sat down after denying the charges. 'Offensive'
Market shock Mr Horie and other Livedoor executives were forced to resign in January after being accused of conspiring to massage Livedoor's profits to give the impression that the firm was continuing to grow strongly.
He is pleading innocent, but other senior executives from the company, including the chief financial offer, have already admitted wrongdoing. Four colleagues including the firm's chief financial officer have admitted their guilt but Mr Horie, whose case has taken much longer to come to court, has denied all charges.
Mr Horie had built up a valuable corporate empire based around his internet business, challenged Japan's business establishment and become a friend of Prime Minister Junichiro Koizumi. I have never done such things and I didn't order such things either Takafumi Horie, in response to indictment
The fraud allegations caused a shock on the financial markets, sending shares plunging in Tokyo and around the world. In his first public appearance since being given bail in April, Mr Horie told a Tokyo court that he was "offended" by the allegations.
Mr Horie's trial is also an embarrassment for Mr Koizumi, who had enjoyed the businessman's support for his programme of political reform. "I regret this indictment," he said. "I have never done such things and I didn't order such things either."
Mr Horie is accused of instructing his subordinates to artificially raise profit figures to maintain the internet's firm growth profile.
Public interest
Prosecutors also claim Mr Horie used unscrupulous methods to buy other companies and to hide Livedoor's growing losses.
The case will hinge on whether prosecutors can prove that Mr Horie was aware of wrongdoing and conspired with other executives.
"The arguments of the prosecutors collapse on their own," defence lawyer Yasuyuki Takai told the court.
"The prosecutors are portraying acts that are totally not criminal as though they are great crimes."