This thread discusses the Content article: Former Nova chief may face formal criminal charges

More information about this situation arises. Turns out that he was formally arrested and charged. The details of the case are pretty shocking of what a CEO of a language corp. is capable of doing.

OSAKA--Nozomu Sahashi, former president of the failed language school chain Nova Corp., was arrested Tuesday on suspicion of instructing the firm's accountants to misappropriate the reserve funds of the firm's employees.

The Osaka prefectural police also arrested Toshihiko Murata, a former deputy manager of Nova's accounting department and a former president of Nova Kikaku, a Nova Corp. affiliate Sahashi owned, suspecting he was Sahashi's accomplice.

The police learned that Sahashi, who was under pressure to return school fees to students who canceled their enrollment without finishing all the lessons, had told his subordinates that the public's anxiety over the school's management would quickly spread unless the school fees were refunded.

The police suspect Sahashi took the initiative in misappropriating the funds as he feared the school's operations were at risk.

According to the police and others, Sahashi, 56, and Murata, 49, allegedly colluded to instruct a Nova accountant on July 20 to transfer about 320 million yen of the funds to a Nova Kikaku bank account he once managed.

Sahashi partially has denied the allegations, while Murata has admitted the allegations.

You can read the rest of the article from the source: http://www.yomiuri.co.jp/dy/national/20080625TDY01303.htm