Japanese insurance companies that worked with the used car chain Bigmotor have submitted reports to the Financial Services Agency, which is focusing on Sompo Japan, a major general insurance company.
Allegations that Bigmotor filed fraudulent insurance claims prompted insurers to cut ties. Only Sompo Japan resumed dealings, even encouraging its policyholders to use Bigmotor repair shops.
According to sources, Sompo Japan President Shirakawa Giichi attended a board meeting in July last year, when he was aware of possible fraud. But sources say he worried about worsening relations with Bigmotor and recommended a return to the partnership.
The agency will investigate whether decisions by Shirakawa and the management were appropriate and will look into communications between the two companies. It will also probe corporate governance at Sompo Japan and its parent firm, Sompo Holdings.