Nikko Asset Management Co. Ltd. said that Takumi Shibata will step down as president and CEO, effective April 1.

The company will appoint Hideo Abe and Junichi Sayato as representative directors and co-CEOs. Abe will assume the role of president, while Sayato will assume the chairman role, according to a March 11 release.

The resignation follows a lawsuit filed in October 2018 by former executives of the asset manager, alleging that Nikko Asset Management and Shibata misappropriated funds earmarked for incentive schemes and diverted the funds into new incentive schemes designed to benefit Shibata personally.

Nikko Asset Management and Shibata attempted to have the lawsuit dismissed on jurisdictional grounds, but failed to do so, Financial Times reported March 11.

They have since made a second attempt, but in rebuttal to that, the former executives filed documents with the with the New York district court in late February. The documents revealed that former CFO of Nikko Asset Management, Frederick Reidenbach, had recorded conversations during which Shibata had allegedly threatened to fire him for attempting to expose the alleged fraud, the report said.