Yuji Naka, co-creator of the Sonic the Hedgehog gaming series and former boss of Sonic Team at Sega, was given a suspended prison sentence and fines that now total $1.2 million for his role in an insider trading scheme dating to 2020.
According to VGC, the Tokyo District Court ruled that Yuji Naka had violated Japan’s Financial Instruments and Exchange Act by illegally buying shares based on inside information and has thus been found guilty of insider trading.
After he pleaded guilty to insider trading charges, clearly showing remorse for his crimes, the judge sentenced Naka to 30 months in jail and a substantial financial penalty. The sentence was then suspended for four years, meaning that Naka will avoid going to jail as long as he adheres to the conditions of his release and doesn’t break the law during this period.
Other sources, however, claim that Yuji Naka made millions of US dollars as a result of his inside trading…
Yuji Naka was arrested twice in 2022, once in November and once in December, on two separate charges of insider trading. The details associated with his first arrest reveal that Naka has been made aware that the Japanese developer Aiming was working on a new Dragon Quest mobile game before the title was officially announced.
He subsequently bought 10,000 shares of Aiming stock with the intention to sell them after the game was officially announced and Aiming’s stock value had increased.
The co-creator of Sonic the Hedgehog was arrested for the second time one month later due to his alleged involvement in similar insider trading. Allegedly, Yuji Naka learned that Square Enix—a company for which he worked on Balan Wonderland—was planning to make Final Fantasy VII: The First Soldier game for mobile.
That particular game was shut down after barely spending one year on the market, developing a reasonably big fan base, and receiving plenty of regularly-scheduled updates.
The charges claim that Yuji Naka, as one of the most famous figures in gaming, used his position and authority to gain access to details surrounding investment meetings and learned of the aforementioned gaming titles long before their public reveal.
Can Yuji Naka Pay His Fines?
Armed with that knowledge, it’s alleged that Naka bought 130,000 shares in total, with his overall profit from the subsequent sale of said shares reaching over $145,000. Unfortunately for Naka, his profits won’t be able to cover the financial penalty incurred by the court.
Allegedly, Yuji Naka learned that Square Enix—a company for which he worked on Balan Wonderland—was planning to make Final Fantasy VII: The First Soldier game for mobile.
Other sources, however, claim that Yuji Naka made millions of US dollars as a result of his inside trading, which is highly unlikely, considering that The First Soldier was shut down and that the Dragon Quest Tact is a free-to-play tactical RPG limited to Android and iOS platforms.
In all honesty, being the co-creator of Sonic the Hedgehog comes with some financial perks, so he’ll likely be able to cover the financial penalty for insider trading.
Unfortunately, he quit working at Sega, and given the overall bad experience, Square Enix had with Yuji Naka—the insider trading and a court battle over Balan Wonderland—the game maker’s course of action remains unclear right now, raising the question of his further employment at gaming studios.
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