Ex-Head of Kimono Rental Firm at Center of Snafu Arrested

June 24, 2018

Yokohama- Police arrested Saturday the former president of the kimono rental service company that caused confusion in this year's Coming-of-Age Day ceremonies on suspicion of defrauding a bank of loans by window-dressing a financial statement.

The Kanagawa prefectural police department arrested Yoichiro Shinozaki, 55-year-old former president of Harenohi, based in Yokohama, Kanagawa Prefecture, on fraud charges.

According to investigative sources, the company allegedly took out loans totaling 35 million yen from a bank in Kanagawa, south of Tokyo, in September 2016 to finance the opening of a new shop, by producing a fictitious financial statement that registered bogus sales in order to show his company was profitable.

In the accounting term to September 2015, Harenohi is believed to have been in excess liabilities but padded sales by about 50 billion yen, the sources said.

Set up in 2011, the company engaged in "furisode" long-sleeved kimono sales and rental services for young women for Coming-of-Age ceremonies.

Despite deteriorated finances resulting from rapid store openings, Harenohi continued to conclude new contracts with customers. But the company suddenly closed its stores in Yokohama and Hachioji, western Tokyo, on this year's Coming-of-Age Day on Jan. 8, leaving many young women without formal attire for the ceremonies.

On Jan. 26, Yokohama District Court decided to start the bankruptcy proceedings for Harenohi. At a meeting of creditors on Wednesday, the company's bankruptcy administrator said the company had assets of only about 16 million yen, against total debt of some 1,085 million yen, so it cannot compensate customers for the Coming-of-Age Day snafu. Jiji Press