Founder of Japan's Livedoor fights fraud conviction

By Elaine Lies

TOKYO, Feb 22 (Reuters) - Disgraced Internet entrepreneur Takafumi Horie, who shook up corporate Japan with his flashy lifestyle and brash takeover attempts, appealed on Friday his conviction on securities fraud.

Horie, 35, was sentenced to 2-½ years in prison a year ago for his role in a securities fraud at his former company, Internet company Livedoor -- an unusually harsh punishment for white-collar crime that was seen as a sign of regulators' determination to clamp down on corporate misdeeds.

Japanese executives who plead guilty and show remorse often avoid time in jail, but Horie insisted he was innocent, telling the court he knew nothing of the problems that led to his arrest.

He blamed other executives at his company but acknowledged he should have been more careful about accounting.

Though Horie was not in court, his defiance was conveyed by his lawyers, who implied that the harsh sentence -- which they said was based on "mistakes" -- might have been at least partly due to his flouting of Japanese corporate norms.

"There's a proverb in Japan that the nail that sticks out will be hammered in," said Yoshio Okada.

He said his client may meet that description in Japan's business community but this should not influence legal decisions.

Horie, who was detained for three months following his arrest before being released, is currently out of jail on bail of 500 million yen ($4.7 million). The appeal process will likely take several months.