Tokyo prosecutors today arrested former Nomura Securities Co president Mr Hideo Sakamaki in connection with a scandal involving allegedly illegal payoffs to a racketeer, it was reported.

Mr Sakamaki, who stepped down as president in March and is now an adviser to the giant brokerage firm, told a parliamentary panel this week that he had briefly met the corporate racketeer at the heart of the scandal involving improper payments, in 1992, but denied knowledge of any stock deals by the racketeer through Nomura. Prosecutors are also investigating one of Japan's biggest banks, Dai-Ichi Kangyo Bank Ltd (DKB), in connection with the Nomura scandal.