Dynam rejects claims of Japan underworld ties, money laundering

A Japanese pachinko operator listed in Hong Kong has denied anonymous allegations that his company has ever been involved in organised crime and money laundering.

Dynam Japan Holdings chairman and chief executive Yoji Sato rejected claims that his company was involved in the crimes, but admitted it had been intimidated by criminal gangs in the past.

The Hong Kong stock exchange also denied it had lowered its standards in letting Dynam list on August 6 as the first Japanese initial public offering in the city.

An anonymous letter sent simultaneously to the exchange, the Securities and Futures Commission and the South China Morning Post alleged Dynam was involved with the Yamaguchi-gumi, a Japanese yakuza organised criminal group, as well as money laundering. "The Tokyo Stock Exchange and Osaka Stock Exchange both banned its listing. Why does the Hong Kong stock exchange adopt such low regulatory standards?" the anonymous report said.

Sato said the company had not applied for a listing in Osaka or Tokyo, but would be able to list in Japan if it met the criteria. He add that no pachinko operator was listed in Japan.

"We chose Hong Kong because Hong Kong is recognised internationally. Hong Kong is a more international market than Japan," he said.