In brief: Authorities in Japan have arrested three people in the last 24 hours for insider trading. At least two of them are former employees of video game giant Square Enix, including the legendary former studio head of Sonic Team Yuji Naka. The charges stem from the trading of stock of a small developer called Aiming.

In September 2020, Square Enix announced a Dragon Quest mobile game titled Dragon Quest Tact. A small, relatively unknown studio named Aiming was working on the project. Some employees within Square Enix had heard this developer was working on a new entry for the beloved DQ franchise before the announcement and bought loads of stock in the company.

According to Japanese news outlet FFN, Tokyo authorities arrested Taisuke Sazaki Thursday evening on charges of insider trading. Sazaki, who had worked on such franchises as Final Fantasy and Kingdom Hearts, purchased 27.2 million yen ($194,000 US) worth of shares in Aiming between December 2019 and February 2020. Authorities allege the purchase came after Sazaki learned the details of the Dragon Quest project.

Sazaki's friend, Fumiaki Suzuki, faces similar charges. He allegedly went in with Sazaki's 162,000 share purchase, making him a co-conspirator.

Tokyo police arrested a third suspect --- Yuri Naka. If the name sounds familiar, it's because Naka was one of the co-creators of the original Sonic the Hedgehog game and subsequent head of the studio responsible for the series, Sonic Team. His resume also includes work on popular games such as Phantasy Star I&II, Nights into Dreams, and Ghouls 'n Ghosts.

More recently, he served as director of the platformer Balan Wonderworld. That game flopped, and Naka left Square Enix. In April 2020, he sued the publisher, claiming he was wrongfully dismissed from the project over disagreements about the game's stability six months before its release and subsequent failure.

Police allege Naka knew of the Aiming deal before it was made public and purchased 10,000 shares in the company worth 2.8 million yen ($20,000 US). Authorities charged him with violating Japan's Financial Instruments and Exchange Act.

Police did not indicate whether any of the suspects had sold off their stock for a profit. Square Enix has not commented on the situation.

Image credit: Yves Tennevin