Kobe Steel President and CEO Hiroya Kawasaki, center, bows during a press conference in Tokyo, Tuesday. Photo: AP
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Kobe Steel admits data fraud went on for nearly 5 decades; CEO to quit

54 Comments
By Yuka Obayashi

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54 Comments
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Simple then! Just bow away 50 years...and see if we can continue on biz as usual.

6 ( +11 / -5 )

50 years of corporate fraud and no criminal charges? With the huge amount of Japanese companies involved in fraud it should be no surprise Japan has lost so many international markets.

11 ( +12 / -1 )

Crooked as they come.

Every single one of the higher ups should be living out their days behind bars.

11 ( +12 / -1 )

Presumably millions of people spend time in homes, offices, schools, ships, planes, vehicles, etc. built with this steel. Rather that bowing and sheepishly sloping off, they should be chained to their desks to try and trace it all.

Japanese government-sanctioned seal of quality

Yep, just drag everyone else down with you. Unless you haven't ruined them already by bid rigging.

10 ( +11 / -1 )

So they have been dishonest for 50 years??!! And then I one is sitting in a jail cell??

Oh that’s right, these are the upper crusts of society, they can just bow away their wrong doing.

7 ( +8 / -1 )

They should all be in jail. But what I really want to know is whether in spite of the data fraud, the steel still had the qualities (strength etc) necessary for what it was used for. Over the past 50 years, has there been a rash of structual failures all traced back to Kobe Steel? I haven't heard of such a thing.

7 ( +8 / -1 )

50 years?!!! They've been fraudulent for almost half the time this company has existed.

6 ( +7 / -1 )

What a shame the US can't jail these criminals they way they jail Japanese auto parts makers:

https://sentaku-en.com/articles/2017/03/employees-of-japanese-auto-parts-makers-behind-bars-in-us.html

A Japanese government-sanctioned seal of quality

Not worth the paper it's printed on. Is there anything in this country that isn't bent?

3 ( +6 / -3 )

Alfie

Corruption isnt uniquely Japanese, but you always assume it is. I’m glad wherever you come from is so clean.

-4 ( +6 / -10 )

Kobe Steel also announced the resignation of Executive Vice President Akira Kaneko and temporary pay cuts for up to 80 percent of all internal directors and executive officers.

why temporary pay cuts? they should all be in jail.

and enough with the bowing shenanigans already. We all know its business as usual behind the scenes. We're not stupid

8 ( +9 / -1 )

Corruption isnt uniquely Japanese, but you always assume it is.

Except I don't. This is Japan Today, not US Today, Spain Today or The Turks and Caicos Today. There's corruption all over the world but the level of corporate corruption in this country is astonishing.

15 ( +18 / -3 )

There is not one single honest for profit corporation in the world, and very few non-profit ones.

2 ( +5 / -3 )

This is the first thought that came to my mind when I saw the picture. Why is that other chap bowing so low. He wasn’t even born when it all began.

2 ( +2 / -0 )

Definitely increase the tariffs on those products.

0 ( +2 / -2 )

And being normal practice in Japan it is reported as a business story, no surprise there

7 ( +10 / -3 )

That's a pretty deep bow, though. That ought to fix it...!

1 ( +7 / -6 )

that deep bow crap doesn't cut it with me

2 ( +6 / -4 )

Each person who had a hand in this shady, crooked behaviour should have their bank accounts raided and their pensions cancelled. If not in a cell, then they should live out their days in poverty.

Not fair they can just bow and retire to an easy life.

5 ( +7 / -2 )

Everyone of these "Fraudulent Gangsters" should be put in Jail for the rest of their lives!

-9 ( +1 / -10 )

Kobe Steel has had a series of scandals in the last dozen years, including taking part in bid-rigging for a bridge project in 2005, failing to report income to tax authorities in 2008, 2011 and 2013, and falsifying emissions data in 2006. Illegal political funding to candidates in local elections in 2009 also prompted the resignations of the then CEO and chairman.

Yet here we are again. Perhaps resignations didnt help? Perhaps they shouldve been jailed and the company closed. jeez, half a century.

3 ( +5 / -2 )

Jees 5 decades? This could be a fatal error and the company may not ever recover.. How many employees in this company will lose their jobs over this scandal?

5 ( +8 / -3 )

You do the bow, No, lets send Suzuki. He’s retiring in April anyways. High fives.

3 ( +5 / -2 )

50 years of lying, does anyone regulate these companies? Did nobody suggest actually making a product that is up to standard? 50 years and they never thought of actually doing their job? It is stupidity compounded.

-2 ( +5 / -7 )

Once again the facade of "Japanese quality" is unveiled. All Japanese products and services are low quality, and likely all falsified as well. Such blatant corruption, data falsification, and low quality would never happen in the West. Just shows how backwards Japan is once again.

6 ( +11 / -5 )

a deep bow solves everything in such a superficial culture, pathetic.

1 ( +8 / -7 )

Just another day in Japan, folks, and as usual, the "punishment" is to retire with a massive windfall bonus and severance package. No prosecution, no actual punishment. Rinse, repeat, and with the words "it's part of culture... we can't change it..." etc.

4 ( +10 / -6 )

And it's really REALLY bad timing with Trump's talk of tariffs on steel products.

0 ( +7 / -7 )

Well, if a junior person could speak up and ask questions in Japanese corporate culture-that wouldn't be happening, but its so easy to shut everyone up and pretend nothing is happening-that's why it kept going on for half a century! they need some moral committee or what..The silencing and power harassment are the roots of the problem.

I had a similar experience at a Japanese company, being the only one speaking against some stupid plan the company chose. I was told that I don't understand anything, and they kept doing what they intended to. A year later (I already quit) my ex colleague told they got into fraud with that project and lost lots of money. I just smirked.

So the stuff happening in other companies does not surprise me a bit.

6 ( +6 / -0 )

Lots of haters in here, I just cant fathom it. KOBE Steel is a tremendous company, and employs over 36,000 people. It is a jobs and wealth creator. Japanese people would be happy for the Government to step in if needed and assist in restucture of the company, like JAL in 2009. Too big to let an icon like KOBE Steel or JAL fall.The alleged poor business practices were regrettable, but a thing of the past.

@ thepersonIamnow

Corruption isnt uniquely Japanese, but you always assume it is. I’m glad wherever you come from is so clean.

So very true. Before posters hate on a wealth creator like KOBE Steel, have a look in their own backyards for even worse corporations.

-6 ( +7 / -13 )

And it's really REALLY bad timing with Trump's talk of tariffs on steel products.

I'm wondering if they didn't release this information because of Trump's talk on tariffs - maybe they were thinking that somehow they could hide in its shroud.

0 ( +3 / -3 )

I can’t keep track of all these scandals, seems like there’s one every hour.

5 ( +5 / -0 )

Lots of haters in here, I just cant fathom it. 

Yeah! It's not like they were just caught having been lying for five decades about the quality of their product that has been used in making countless buildings and vehicles.

Oh wait...

5 ( +10 / -5 )

It's not like they were just caught having been lying for five decades about the quality of their product that has been used in making countless buildings and vehicles.

There are far bigger world corporations that have been lying,scamming and cheating for many years. Look at Volkswagen. Its business as usual for them now.

-6 ( +3 / -9 )

Nothing new here in Japan. These so called giants always do what they like and abuse the others. On the outside they appear to be professional but deep down they are no different from a criminal.

8 ( +8 / -0 )

Their bowing is certainly improving

5 ( +5 / -0 )

Anyone of you remembers that Apple actually sabotages its own products ???

-3 ( +0 / -3 )

Ganbare Japan: "KOBE Steel is a tremendous company"

Obviously! I mean, this isn't about continuous crime over FIFTY years -- it's about how great Japan is! Don't forget, you also describe Hanyu the same way you describe Kobe Steel, my friend.

"There are far bigger world corporations that have been lying,scamming and cheating for many years."

That's true! Toshiba, Olympus, Suzuki, Long Term Credit Bank, Yamaichi Securities, Kanebo, Nikko Cordial Corp., IHP Corp., Livedoor, Takata, Mitsubishi Motors, Asahi Kaisei, Toa, Mizuho Bank, Toyo Tire and Rubber, and more.

"Before posters hate on a wealth creator like KOBE Steel, have a look in their own backyards"

Why? because you can't accept the truth about YOUR own backyard and fall back on the "shouganai" culture that allows it to happen AGAIN and AGAIN. This is not Kobe Steel's first time being caught, and every time they've said they will change, and have not. "But not our fault! It's society!" people like you say, as though you cannot speak up except in blanket praise of all that is ill.

And sorry, there is nowhere in the world the same amount of corporate fraud occuring regularly and without punishment, and with these amounts. Nowhere. So take your own advice, and instead of getting defensive at people pointing out the problems on an article that Kobe Steel has admitting wrongdoing in, you try to change society and prevent this sort of thing from continuously happening and merely saying, "Shouganai" and becoming a laughingstock worldwide.

9 ( +11 / -2 )

Anyone of you remembers that Apple actually sabotages its own products ???

That's the narrative that some people try to paint.

But having done software/hardware development, I'm more inclined to believe Apple's explanation of it. The idea wasn't to force people into buying new phones, it was to create a phone that could receive updates over time, even while the hardware is declining. They do this by dropping some of the bells and whistles, causing the device to use less resources, extending its lifespan. The alternative would be to deny updates whatsoever, forcing users to remain on an older, unupdateable system. If they did this, users would then complain that they were being forced to by new phones due to their old ones being stuck on older OSes. It would also mean that Apple would have to maintain more versions of their OS for longer, requiring more resources to maintain.

2 ( +4 / -2 )

Hmmm ... didn't the prime minister use to work at kobe steel ?

4 ( +6 / -2 )

Yes Sinzo did work at this company, it's where he learnt how to manage. Lies corruption are a learnt skill, not a natural state.

3 ( +6 / -3 )

U.S. consumers have filed a lawsuit against Kobe Steel Ltd (5406.T) and Toyota Motor Corp (7203.T) accusing the companies of violating consumer protection laws and engaging in fraud by concealing the use of substandard metal components in vehicles.

4 ( +5 / -1 )

Onion in hand to facilitate the crocodile tears.

3 ( +4 / -1 )

The problem is that Japan does not have watchdogs to catch this sort of fraud, and that the Government is more than likely complicit in this. Japan Inc motto better to not to let rest of the world the level of corruption in this country, and if you have lived here and worked in business long enough you will see the extent is unprecedented in a advanced country.

4 ( +4 / -0 )

If Kobe Steel is that bad, imagine how bad Chinese companies must be...

-2 ( +3 / -5 )

Reckless: "If Kobe Steel is that bad, imagine how bad Chinese companies must be..."

Yeah, let's deflect!

No other nation on the planet says, "It happens so much because it's a part of our culture... there's nothing we can do!"

3 ( +5 / -2 )

@smithinjapan: the substance of the fraud is not clear to me and could mean insignificant quality issues because of Japan's plethora of rules. I find Japanese have a strong sense of conscientiousness in their work and thus would suspect that even if some fraud is found at Kobe Steel, it must pale in comparison to Chinese quality practices or lack thereof. But that is my own bias.

0 ( +3 / -3 )

 I find Japanese have a strong sense of conscientiousness in their work and thus would suspect that even if some fraud is found at Kobe Steel, it must pale in comparison to Chinese quality practices or lack thereof. But that is my own bias.

Excellent comment. In Chinese Corporations (and probably the Koreas) this incident would be covered up and never exposed. Whereas in Japan, regulator is dealing with the alleged "data fraud" promptly and will be dealt with if fraud is actually found. Japanese people and Government will never accept bad business practice, it goes against their ethic, thats why even massive Corp. like KOBE Steel is being investigated.

0 ( +3 / -3 )

Japanese people and Government will never accept bad business practice

Oh man! Thanks for the laugh!

5 ( +6 / -1 )

There’s a clear divide between those who use examples to bash, and those who can see things objectively. Of Japan has corruption and it has a lot of cronyism and is basically an old mans club.

It doesn’t take a genius to know that at all! However I have lived in over 20 countries and compared to most of the world Japan isn’t so bad and hardly amongst the worst.

Corruption is a human trait, but it’s actually easier to bash and talk down than to be able to think objectively.

However sure, if you want, go ahead and say Japan is oh so horrid and the worst when it comes to corruption. Opinions are a dime a dozen.

-5 ( +0 / -5 )

smithinjapanToday  04:27 pm JST

No other nation on the planet says, "It happens so much because it's a part of our culture... there's nothing we can do!"

Surely you jest my friend! That’s like the most common excuse I see around the world.

For instance, guns and Americans...list goes on and on the more you know.

-4 ( +1 / -5 )

but but, Japanese quality and workmanship....

2 ( +4 / -2 )

Yep. Japanese products are absolute crap. That's why no one anywhere in the world wants to buy Japanese products, especially products containing lots of steel such as automobiles and ships.

Japanese are just about the dumbest people in the world. That's why they can't keep trains on their tracks let alone have them run more or less on time.

And look at the the stuff they supply to US companies like Boeing. Something like 30% of recent Boeing jumbo jets is built in Japan and those damn planes are crashing left and right.

-7 ( +1 / -8 )

@bullfighter

And look at the the stuff they supply to US companies like Boeing

Yep, the Yuasa batteries that catch on fire. Boeing now has to encase the Japanese batteries in a steel container to make them (hopefully) safe.

6 ( +6 / -0 )

I guess this happens everywhere in the World, but what makes it more interesting is that here in Japan, the pride upon Quality has suddenly taken a knock sideways.. I doubt that the Quality of the actual products was less than those produced elsewhere, an indeed it's probably better, but the fact that "Lying" has been exposed as a part of the Norm here in Japan, sort of brings them down to the level of the rest of the World.

So who you going to trust now-a-days ?

0 ( +0 / -0 )

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