co-creator of Sonic the hedgehog A veteran programmer — one of the most high-profile figures in the Japanese games industry — has been arrested on suspicion of insider trading fraud involving an investment of just $20,000.
Produce credits for his early career at game development company Sega Phantasy Star Online less famous people Billy Hatcher and the Giant Eggwas arrested on Friday.
Naka, 57, spearheaded the development of his most famous work, the trainer-wearing hedgehog protagonist in more than 15 games, giving Sega a character to take on Nintendo’s games. Super mario Franchise — The generation-defining clash of the “console wars” fought in the late 1980s and early 1990s.
In a statement, the prosecution claimed that Naka, who moved to game developer Square Enix in 2018, purchased shares worth 2.8 million yen in Aiming, a small Tokyo-listed game studio, in January 2020. did.
A few weeks later, Square teamed up with Aiming to create a highly popular dragon quest Mobile Game Series — Information Prosecutors claim Naka owned when he made the investment.
The announcement sent the stock skyrocketing to all-time highs in July when the game itself was released, giving Naka a theoretical return on his investment of about 250%, or about $30,000.
In front of the Reform of the Tokyo Stock Exchange in April of this year, Aiming listed on the Mothers section, known for the volatility of high-growth and emerging stocks. This section has been popular among retail investors seeking high returns using volatility.
Mr. Naka could not be reached for comment after his arrest. Prosecutors said two Square Enix executives were also arrested Thursday on suspicion of making a large investment in Aiming around the same time.
Prosecutors have not said whether they believe Naka sold Aiming shares.
Square Enix said it was “fully cooperating with requests” from Japan’s Securities and Exchange Surveillance Commission, which launched an investigation into the company in June 2021.
Previous high-profile insider trading cases in Japan include Yoshiaki Murakami, a shareholder activist who was convicted in 2007 of trading stock with prior knowledge of a proposed takeover bid for a radio operator by Horie’s internet company Livedoor. This includes the case of Takafumi Horie.
Naka’s arrest follows an unusually public and bitter altercation with his former employer, Square Enix.Conflict centered on insecurity balan wonder world, a game he directed but deemed not ready for sale. It was poorly received by critics when it was released in 2021, eventually leading Naka to declare Square Enix a company that “doesn’t value games or game fans.”
rear balan wonder world Square Enix fired Naka, and Naka sued the developer for wrongful dismissal.
Earlier this year, Mr. Naka posted a tweet announcing the lawsuit. Square Enix declined to comment on the lawsuit.