Yuji Naka has reportedly been arrested as part of the Square Enix insider trading investigation

Former Sonic Team boss and Sonic the Hedgehog programmer Yuji Naka has reportedly been arrested in connection with the Square Enix insider trading investigation.

Japanese news site FNN Prime Online is reporting that Naka is the latest suspect in an insider trading case surrounding a new Dragon Quest game.

On Friday, two Square Enix employees were arrested in Tokyo as part of an insider trading scheme.

Taisuke Sazaki and Fumiaki Suzuki have been arrested for taking advantage of Japanese developer Aiming, shortly before it was announced that it was working on a new Dragon Quest game.

Both were sold at a price of ¥47 million ($336,300) in Aiming, before confirming to the public that it was developing the mobile title Dragon Quest Tact.

Now, according to FNN, the Special Prosecution Department of the Tokyo District Public Prosecutors Office has also arrested Naka for the same crime.

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It is said that before Dragon Quest Tact was announced, Naka – who was working on Balan Wonderworld for Square Enix at the time – bought about 10,000 shares of Aiming stock for about ¥2.8 million ($20,000 ).

By buying the stock before the announcement, it is believed that the three defendants took advantage of insider information in order to buy back the stock when the value rose.

After the two suspects were arrested, Square Enix issued a statement confirming that they were former employees and said it was cooperating with authorities in the investigation.

“Today, a number of media outlets reported that former Square Enix employees are being investigated for alleged human trafficking,” the statement said.

“We have cooperated with the requests from the Securities and Exchange Surveillance Commission. As the investigation by the Tokyo District Public Prosecutors Office begins, we will continue to cooperate with the investigation.

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“We deeply regret the great anxiety caused to everyone. We have taken this incident very seriously, with internal disciplinary actions taken against the employees involved.

Yuji Naka arrested as part of Square Enix insider trading investigation

Square Enix is ​​Yuji Naka’s former chief executive, where he directed the critically acclaimed Balan Wonderland before leaving the company last year.

However, development on Balan went poorly and Naka sued Square Enix, claiming that he was removed from the project six months before release.

Naka first spoke out against the development of Balan Wonderworld in April, in an explosive series of tweets.

“Game makers aim to improve their games until the end, and I believe it would be wrong to prevent them from achieving this goal,” Naka wrote in April, translated by VGC .

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“I asked my lawyer to consult with our business partners to allow me to solve the problems related to the development of Balan Wonderworld until the end, but they did not take care of my requests, because then I decided to file a complaint in court.

“It is because of this that Balan Wonderworld has received criticisms and comments that you are well aware of,” he said. “It’s a very unfortunate end to a project that I’ve led from the beginning.

“Personally, I believe that it is a real shame that Balan Wonderworld was released in the state it was in. Therefore, I believe that Square Enix and Arzest are the companies that do not care about the games and their they are fans.