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Yuji Naka admits guilt to Square Enix insider trading charges

The former Sonic Team lead and Balan Wonderworld director was arrested in 2022 for allegedly using confidential company information to buy and sell stocks.

TJ Denzer

March 2, 2023 7:45 AM

Image via Square Enix

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Coming off of the difficult commercial failure of Balan Wonderworld, director Yuji Naka has been caught up in a litany of legal action that doesn’t seem to be ending any time soon. Confronted with allegations of insider trading amounting to around $145,000 USD during his time at Square Enix, Naka admitted guilt to the charges and may be faced with criminal penalties in Tokyo’s District Court.

Yuki’s admittance of guilt to the charges was reported by Japanese news outlets NHK and TBS News Dig. The game designer and director was arrested in November 2022 for allegations of insider trading, and then arrested again in December 2022 under similar allegations. In the first allegations, during his time directing Balan Wonderworld, Naka supposedly learned that Japanese developer Aiming was working on mobile game Dragon Quest Tact before it had been announced. He then bought stock in Aiming with the apparent plan of selling after the game was announced. Naka allegedly similarly bought stock with the intention of selling when he accessed confidential company information and learned that Square Enix was prepping the unannounced Final Fantasy VII: The First Soldier with mobile developer ATeam Entertainment.

Faced with the allegations above, Yuji Naka shared a statement that seemed to admit full responsibility and knowledge in both matters.

“There is no doubt that I found out about the games before they were made public and bought shares in them,” Naka was quoted as saying by TBS News Dig.

Yuji Naka is best known for co-creating Sonic the Hedgehog, leading the Sonic Team for a long time, and aiding heavily in the development of other Sega titles like several Phantasy Star games, Nights into Dreams, ChuChu Rocket!, Samba de Amigo, and much more. However, his most recent work was helming the unsuccessful Balan Wonderworld, a development process allegedly so muddled by Square Enix that Naka would later file a lawsuit against the publisher over removing him from the project and releasing the game in an unfinished state.

It seems Naka is likely to receive penalties for his admittance to the insider trading allegations above. To what degree remains to be seen. The game creator expressed interest in starting from scratch with mobile game design, but these plans may be on hold for a while as he sorts out legal issues. Stay tuned as we continue to follow for more information and updates on the situation.

TJ Denzer

Senior News Editor

TJ Denzer is a player and writer with a passion for games that has dominated a lifetime. He found his way to the Shacknews roster in late 2019 and has worked his way to Senior News Editor since. Between news coverage, he also aides notably in livestream projects like the indie game-focused Indie-licious, the Shacknews Stimulus Games, and the Shacknews Dump. You can reach him at tj.denzer@shacknews.com and also find him on Twitter @JohnnyChugs.