TOKYO (TR) – The controversial founder of the collapsed commercial lender SFCG allegedly panicked after the “Pandora Papers” leak in 2021 exposed a massive offshore fortune, which former insiders claim totals 46 billion yen and is currently funding a heavy-handed loan business in Laos.
According to weekly tabloid Flash (Nov. 30-Dec. 7, 2021), billionaire Kenshin Oshima had been frantically contacting former executives of the now-defunct SFCG (formerly Shoko Fund) at the time, instructing them to feign ignorance if approached by the media.
“He warned us to say we know nothing if the press calls. He seems terrified of being arrested again,” a former executive told reporters.
Testify in the Diet
Oshima founded Shoko Fund in 1978, building a massive empire by issuing high-interest loans to small and medium-sized enterprises. The company achieved explosive growth through ruthless collection tactics targeting loan guarantors —methods so severe they drove some to suicide and led to Oshima being summoned to testify before the Diet in 1999.
The company, rebranded as SFCG, ultimately went bankrupt in 2009 with a staggering 548 billion yen in debt.
Just prior to the collapse, Oshima was accused of transferring 267 billion yen in assets to relative-owned companies for little to no cost. He was arrested in 2010 on suspicion of concealing assets, but the flow of funds could not be definitively traced. In 2016, the Tokyo High Court handed him a full acquittal.
However, the massive “Pandora Papers” leak in October of 2021 revealed that Oshima was the beneficial owner of at least seven shell companies in tax havens like Panama. Documents showed one Panamanian entity received a 600-million-yen loan from a British Virgin Islands company registered under his relative’s name.
“Hid 46 billion yen”
According to the former executive, the 600 million yen is merely the tip of the iceberg.
“Oshima sensed the company was going under and began creating hidden assets to evade bankruptcy recovery,” the executive revealed. “He scattered seven paper companies across Panama, the British Virgin Islands, Switzerland, the Cayman Islands, and the Bahamas. In total, he hid 46 billion yen.”
The insider claims Oshima used this illicit 46-billion-yen fortune to relocate to the capital of Laos, Vientiane, where he has resurrected his controversial business model.
“Invest” in Laos
According to a former employee of the Laos operation, Oshima now runs an auto-backed lending, leasing, and consumer finance network that moves 24 billion yen annually. He allegedly funnels the hidden money from his tax havens to his family, who then “invest” it into the Laos companies.
Oshima has even brought former Shoko Fund employees from Japan to run the overseas operation. However, his aggressive collection tactics are already drawing heat.
“The Laotian authorities are cracking down on his heavy-handed collections,” the former employee said. “Until now, they were paying bribes to make problems go away, but they have reached their limit.”
No comment
Oshima, who currently resides in Laos, did not respond to requests for comment by Flash regarding his hidden assets.
Satoshi Oikawa, a lawyer representing victims of Shoko Fund’s predatory lending, expressed shock at the revelations.
“I knew he had applied for permission to travel to Laos during his trial, but I never imagined it had escalated to this,” Oikawa said. “If he truly has 46 billion yen, it must be seized as newly discovered assets and distributed to creditors. If he actively concealed it, this could constitute fraudulent bankruptcy. It is not an issue that can just be ignored.”
For Oshima, the walls may have started to crumble in 2021. As his former executive noted: “The old Shoko Fund methods were never going to last forever. It’s finally time for Oshima to pay the piper.”