'There is no doubt that I knew the facts'—Sonic creator admits insider trading guilt on first day of trial

Yuji Naka presents Balan Wonderworld while dressed in a top hat and neckerchief.
(Image credit: Square Enix)

Yuji Naka had his first day in court today, but he might not need many more. The Sonic and Balan Wonderworld creator appears to have admitted guilt in the insider trading case brought against him last year, concerning ownership of shares worth $1 million and $20,000, respectively, in ATeam and Aiming Inc. The two companies are mobile developers that collaborated with Square Enix on the development of iOS and Android games based on the company's properties: ATeam worked on Final Fantasy 7: The First Soldier and Aiming worked on Dragon Quest Tact.

Naka is accused of using his knowledge as a Square Enix insider to manoeuvre himself into a highly lucrative position: Purchasing shares before the partnerships were public knowledge in order to take advantage of an inevitable increase in value when there were finally announced, allegedly netting himself a profit of around $146,000. Textbook insider trading, essentially, and it seems he has no intention of denying it.

As reported by NHK (via TimeExtension), Naka told the court that "There is no doubt that I knew the facts about the game before it was made public and bought the stock," which is about as straightforward an admission of guilt as it's possible to get. Given that Japan maintains a 99.9% conviction rate in all cases brought before its criminal courts, it's likely that playing ball is Naka's best bet here, and he's probably hoping to earn himself more lenient treatment by cooperating.

It's not been a great few years for Naka. Not only was he arrested twice last year—once for the shares in Aiming Inc. and once for the ones in ATeam—but there's been no end of drama surrounding Balan Wonderworld, the whimsical 3D platformer on which he served as project director before Square Enix removed him (and which got a negative reception when it released). 

Naka's been picking no end of fights over the game, accusing Square Enix of being a "no good" company that doesn't "[care] about games and game fans," and editing out his former partner on Sonic, Naoto Ohshima, from publicly-shared photos in a move that was as petty as it was bizarre. All told, Naka seems like he could be a difficult person to work with indeed.

Joshua Wolens
News Writer

One of Josh's first memories is of playing Quake 2 on the family computer when he was much too young to be doing that, and he's been irreparably game-brained ever since. His writing has been featured in Vice, Fanbyte, and the Financial Times. He'll play pretty much anything, and has written far too much on everything from visual novels to Assassin's Creed. His most profound loves are for CRPGs, immersive sims, and any game whose ambition outstrips its budget. He thinks you're all far too mean about Deus Ex: Invisible War.