Embezzlement At Daiwa House Subsidiary

Embezzlement at Daiwa House subsidiary

A major Japanese homebuilder has announced that an executive and 2 others at its subsidiary in China are suspected of embezzling more than 200 million dollars.

Osaka-based Daiwa House declared at a press conference on Wednesday that the money was illicitly withdrawn at a company it jointly set up with a Chinese firm in Dalian.

It says the swindling was detected by an in-house probe that started after a Chinese woman in charge of accounting was seen attempting to take corporate records outside the office last Thursday.

It adds that 3 people, including the woman and her relative who is a company executive, have fled.

Some 23 billion yen, or over 212 million dollars, was withdrawn. The company says if it fails to recover the full sum, Daiwa House and the Chinese firm will each write off half the amount.

Records kept at financial institutions show the wrongdoing began in 2015, but the audit firm in China failed to report the irregularities.

Daiwa House President Keiichi Yoshii acknowledged that the company placed too much trust in the auditor, and failed to scrutinize the books itself.

He said he wants to prevent a recurrence by looking into whether other company affiliates may be engaged in similar practices.