A decision is expected within days for the tycoon.

Prosecutors this week are closing in on one of Japan's wealthiest individuals believed to have been behind the scandals that caused untold damage and embarrassment to his empire, sources said.

The Tokyo District Public Prosecutors Office has entered the final stage of its investigation into Yoshiaki Tsutsumi, the former Kokudo Corp. chairman. He is suspected of involvement in falsified financial statements and insider trading concerning Seibu Railway Co. shares.

To solidify their case, authorities are trying to establish a direct link between Tsutsumi and the scandals.

For the false statements, prosecutors want to prove that Tsutsumi gave the orders, the sources said.

Seibu Railways submitted reports that grossly understated Kokudo's stake in the railway company to conceal a violation of a Tokyo Stock Exchange rule that prohibits the combined stakes held by the top 10 shareholders of a company from exceeding 80 percent.

Kokudo, the railway's top shareholder, and other large shareholders had gone over that limit for years. But prosecutors are focusing mainly on a false financial statement submitted in June 2004, the sources said.

Terumasa Koyanagi, the former Seibu Railway president who killed himself in February, was the one who submitted the report. But he had no direct contact with Tsutsumi concerning that report, sources said.

For many years, Kokudo owned Seibu Railway shares although many were reported in the name of individuals, including former employees. Earlier reports said Tsutsumi knew the shares were held under dubious ownership.

For the insider trading allegations, prosecutors are targeting Kokudo's sales of Seibu shares before they plunged when the false statements were made public, the sources said.

The sales were intended to lower the percentage of shares held by Kokudo to clear the TSE rule and prevent Seibu Railways from being delisted.

The announcement of the false statements, however, not only sent the share price into a tailspin, they also led to the railway's delisting.(IHT/Asahi: March 1,2005)