Appearing in Tokyo District Court this week on financial crimes charges,Sonic the Hedgehogcreator Yuji Naka acknowledges that he was involved in insider trading during his time at Square Enix. The creator of the iconic Blue Blur and former head of Sega’s Sonic Team,Yuji Naka was arrested for insider tradingin late 2022 along with two other employees of Square Enix.
An icon of the industry, Yuji Naka began his career in gaming at Sega in the 1980s working on titles for the company’s initial foray into the console market, the SG-1000. After helming franchises like the popularPhantasy Starseries of RPGs, Naka was tasked in 1989 with creating a mascot that could rival Nintendo’s popularSuper Mario Bros.franchise. Taking the platforming mechanics of Nintendo’s hit series and adding a bit of attitude along with a serious dose of speed, Naka eventually settled on a design for what would become the firstSonic the Hedgehoggame. While Sega would eventually exit the home console market in 2001, theSonicfranchise would continue to grow, with the company recently announcing that 2022’sSonic Frontiershas “greatly exceeded” sales expectations.
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In a story originally published by Japanese news outlet NHK, it’s been revealed that Yuji Naka has admitted in court to violating Japan’s Financial Instruments and Exchange Act as part of an insider trading scheme while working at Square Enix. Naka has been charged with using insider information about unannounced games in some of Square Enix’s most popular franchises to purchase shares in the developers of those titles, stating to the court that “There is no doubt” that he used confidential knowledge for his own financial gain. Initially arrested on charges of insider trading related toDragon Quest Tact,Yuji Naka was arrested for a second timeonly weeks later for purchasing shares of Ateam, the developer ofFinal Fantasy 7: The First Soldier.
Naka admitted to purchasing over 130,000 shares of the developers after learning about their then-upcoming titles and netted 20 million yen, or roughly $145,000 from the eventual sale of those stocks. While claims of financial impropriety are nothing new in the gaming industry, with employees of both Activision Blizzard and Starbreeze Studios facing accusations of insider trading in recent years, it’s rare to see a high-profile figure likeSoniccreator Yuji Naka caught in authorities’ crosshairs. The trial is still ongoing, and it remains to be seen what penalties Naka will face if found guilty.
Following this admission of guilt to Japanese authorities, Naka’s insider trading scheme seems poised to somewhat tarnish the legacy of an otherwise beloved creator. Perhaps if he’d had aSonic the HedgehogTarot deck, he could’ve read the cards to see how poorly his plans would go in the end.
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