Japan’s SMBC Nikko Securities and a handful of executives have been indicted and arrested for alleged market manipulation.

The brokerage – a unit of Sumitomo Mitsui Financial Group (SMFG) – is taking the arrests and indictments and of the company itself «extremely seriously,» according to a press release published on its website Thursday.

The results of the investigation and evidence disclosure by the prosecution will be reviewed, SMBC Nikko Securities said.

«Responsible as a Company»

«However, we cannot deny that there was a shortcoming in the internal control system, and in that sense, we recognize that we are bound to be held responsible as a company,» the brokerage said.

«We will continue to cooperate fully with the investigations by the relevant authorities,» it said.

A vice president, Toshihiro Sato, was arrested on charges of violating securities regulations, in a move following the arrests of four employees earlier in March, according to an Associated Press report. Japanese media reports had cited the four employees as saying they were carrying out normal procedures and denying wrongdoing, the AP reported, noting a comment wasn’t available from Sato.

«Block Offers»

The arrests were related to «block offers,» or after-hours large-volume trades which allow investors to unload shares without creating a negative price impact.

SMBC Nikko is under suspicion of having bought the stocks on the market via proprietary trading, which might have been aimed at preventing closing share prices from falling below levels where block-offer investors were willing to sell.