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Saturday, June 9, 2007

Comsn president to step down over certification fraud


Staff writer

Staffing agency Goodwill Group Inc. apologized Friday for the certification fraud involving its nursing-care unit Comsn Inc. and announced that the firm's president, Koichi Higuchi, will resign to take the blame for the scandal.

But Goodwill Group Chairman and CEO Masahiro Origuchi said he will remain in his position to continue running the group.

"We did everything to protect our customers, and never meant to do something that would be considered illegal," Origuchi said. "I know that it may not win the public's understanding, but for Goodwill to continue working on our mission, I need to stay in my position."

During the joint news conference Friday, Higuchi also said an in-house probe revealed a large number of certification application documents for Comsn's branches were missing.

"I'm really sorry for the sloppy management," Higuchi said.

On Wednesday, the Ministry of Health, Labor and Welfare announced it would no longer allow Comsn to renew the licenses of 1,655 of its nursing-care centers for allegedly inflating the number of its employees and also for overcharging the government for nursing-care services.

On Thursday, Comsn signed an agreement to hand over its business and employees to NSS Corp., another Goodwill affiliate. The ministry said the deal, which met with harsh criticism, was unacceptable.

In response, Origuchi said the firm would freeze its plan, and Comsn would follow government guidance and ask its competitors to take over its customers. However, he added his company hopes to continue its nursing business.

Comsn fraudulently inflated the number of caretakers under its employ in reporting the payroll of a care center in Aomori Prefecture to get the license for its business there.

The ministry also determined Comsn made a flagrant attempt to escape punishment when it closed down its care centers in Tokyo when the metropolitan government was poised to revoke their licenses.

Based on these incidents, the ministry applied the guilt-by-association clause for Comsn. On Wednesday, the ministry told all prefectures that have issued operating licenses to Comsn not to renew the six-year permits to the firm's care centers when they expire between next April and March 2012. They also said not to issue any new ones to the firm.

As of the end of May, Comsn was running 2,081 welfare institutions across Japan, of which 426 are not subject to the punitive step.

Earlier in the day, Health, Labor and Welfare Minister Hakuo Yanagisawa pledged to study a legal revision in response to an earlier attempt by Comsn to dodge government punishment using a legal loophole over fraudulent business license applications.

Yanagisawa made the pledge at a Lower House panel meeting as Comsn tried to hand over its business to NSS Corp. on July 31.

Information from Kyodo added



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