Softbank to sue for damages

7 March 2007

Japanese media and finance giant Softbank is to sue a brokerage and the Financial Times in the wake of a brokerage house report that had been scathing about its accounting practices.

Softbank are to sue for damages and a retraction of the accusations following the fallout from the report from CLSA Asia-Pacific Markets, which was subsequently cited in an article in the FT.

Since the publication of the report, which alluded to a series of "red flags" in Softbank's figures, the bank's market value has dropped by $2 billion.

The report had suggested that Softbank's replacement of scandal-hit PricewaterhouseCoopers with Deloitte Touche Tohmatsu as its new auditor may necessitate a revision of the bank's figures.

A statement from Softbank explained that the decision to sue had been taken after it deemed that the report could "damage our credibility in the market by inviting the misunderstanding that we have engaged in improper accounting practices."

Softbank's market capitalisation as of February stood at $33 billion.

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