Yuji Naka | Sonic the Hedgehog creator gets $1 million fine and suspended sentence

Yuji Naka

Sonic the Hedgehog creator Yuji Naka has avoided a jail term for insider trading, but has received a fine of 172 million yen, or around $1.1 million.


Yuji Naka, best known for his work on Sonic the Hedgehog, has now been sentenced for insider trading. According to IGN, a court in Tokyo has given the game designer a two-and-a-half prison sentence – which is suspended for four years, meaning Mr Naka could still face jail time if he breaks the law (or the terms of his sentence) in the interim.

The greater punishment, meanwhile, is financial: Judge Madoka Hiruta, of the Tokyo District Court, hit Naka with fines amounting to 172 million yen – over $1 million.

The whole sorry affair began when Naka joined Square Enix in 2018. Around that time, he allegedly purchased 10,000 shares in developer Aiming Co., having discovered that the studio was making a Dragon Quest mobile game – a project that hadn’t yet been made public. He then allegedly used his insider knowledge a second time in 2021, purchasing some 120,000 shares in ATeam, a studio making its own mobile game based on a Square Enix property – Final Fantasy VII: The First Soldier. All told, these ill-gotten shares were said to be worth around $1 million.

“He [Naka] was known as one of the world’s most famous game developers, and had the authority to access joint development information,” said Judge Hiruta as the ruling was made. “It has damaged the fairness and soundness of the stock market and the trust of investors.”

It’s a quite spectacular fall from grace from one of the Japanese games industry’s biggest names. Yuji Naka began his career at Sega in the 1980s, serving as programmer on such early titles as Girl’s Garden and Phantasy Star, as well as the excellent Mega Drive port of Ghouls ‘n Ghosts. Naka’s fame then grew massively when he programmed Sonic the Hedgehog in 1991, and worked on its sequels in the US.

Most recently, Naka worked at Square Enix, directing the ill-fated 3D platformer Balan Wonderworld, released in 2021. The game was poorly received, and relations between Naka and Square Enix soured to such an extent that Naka said he planned to sue the publisher in 2022. This was all before Naka’s arrest for insider trading in November that year.

It isn’t currently clear whether Naka still has the appetite – or funds – for his planned legal battle with one of Japan’s biggest publishers.

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