GungHo reveals $2.35m embezzlement by former senior executive

• GungHo Online Entertainment revealed that a former senior executive had embezzled company funds over several years.
• The executive created fake outsourcing orders, posing as both client and contractor to siphon money.
• Losses totalled 246 million yen ($1.67m), rising to $2.35m after improper third-party payments.
• GungHo dismissed the executive, contacted authorities, and is preparing criminal charges.

Puzzle & Dragons developer GungHo Online Entertainment has disclosed that a former senior executive had been embezzling company funds for several years.

As reported by Automaton, the company announced it had dismissed a senior executive on July 24th, 2025 after discovering they created fake work orders on an outsourcing platform, posing as both client and contractor to siphon company funds.

The former executive embezzled around 246 million yen ($1.67m) through fake outsourcing orders and made additional improper payments to a third party, bringing GungHo’s total losses to $2.35m.

Taking responsibility 

GungHo said it will introduce new preventative measures to prevent similar occurrences in future, and its leadership will take responsibility through pay cuts.

CEO Kazuki Morishita’s salary has been reduced by 30% for three months, and executive directors’ pay was cut by 10% over the same period.

GungHo uncovered the misconduct after launching an internal probe, followed by a joint investigation with external legal and accounting firms once suspicions arose.

The company said it has dismissed the executive, reported the case to authorities, and is preparing criminal charges, noting that the individual’s excessive authority made the misconduct hard to detect.