Japan’s biggest brokerage, Nomura Holdings, is having a tough year.
On Thursday, the firm’s CEO Kentaro Okuda, alongside a handful of other executives, announced they’d be cutting their own pay, following the news that a Nomura employee had manipulated Japan’s bond market.
Okuda has agreed to return 20% of his pay for two months, alongside the executive vice president of global markets, the deputy president, and many other executives—though some are only returning 10%.
What’s more, within an hour of the announcement, news broke that a former employee of Nomura had been arrested on suspicion of robbery, arson and attempted murder.
Kyodo News, a leading Japanese outlet, reported that the 29-year-old man was working at Nomura when he allegedly carried out the crimes. The man reportedly drugged a Nomura customer and his partner before stealing the equivalent of $170,000 from their house and setting it aflame. (The couple, in their eighties, reportedly escaped.)
A Nomura representative declined Fortune’s request for comment, but a spokesperson told Bloomberg that it’s “extremely regrettable that a former employee of ours has been arrested.”
Japan’s Financial Services Agency (FSA) uncovered the bond market manipulation in September. It reported that, over the course of one day in March 2021, an employee at Nomura placed “misleading orders” in the government bond futures market—and then went on to turn a profit without any plans to buy or sell the orders they placed.
The move, Japan’s FSA said, is called “layering.”
Per Nomura’s recap of the event, “an employee involved in proprietary trading placed multiple sell orders on the Osaka Exchange for Japanese government bond (JGBs) futures at the best offer or inferior prices to layer the ask order book while buying the same JGB futures at a lower price, and placing multiple buy orders at the best bid or inferior prices to layer the bid order book, while selling the same JGB futures at a higher price.”
The employee’s “series of derivative transactions and orders misled the market into believing that futures trading was thriving, potentially causing fluctuations in futures prices on the Osaka Exchange,” the company said.
Sources told Bloomberg that the employee who placed the orders has since left Nomura. Many Nomura customers and institutional investors have left, too, the sources added.
In a Thursday statement, Nomura took ownership of the situation. “We apologize to our clients and all other concerned parties for the trouble this has caused,” the firm wrote.