The co-creator of the iconic video game Sonic the Hedgehog was arrested today by the Special Investigative Division of the Tokyo District Prosecutor’s Office for alleged insider trading, according to a report in Variety.

Naka Yuji, along with two other former game developer employees Square Enixwas taken into custody on charges of insider trading.

The scandal involves Square Enix and the online games production company to target. Between December 2019 and December 2020, the two companies quietly planned a joint venture to develop a new Dragon quest mobile phone game.

But Yuji and associates gained access to sensitive information about the impending deal before the public announcement and bought 10,000 shares of Aiming for about $20,000. The illegal trading scheme violates the law on financial instruments and exchange trading.

At the time of going to press it was not yet known whether any of those arrested sold their shares.

Who is Yugi Naka?

Yugi Naka in 2005. Photo by Kevin Winter/Getty Images

Naka, 57, is a cult figure in Japan. In 1991, while working for the video game company Sega, he was a co-creator sonic the hedgehog, a game with a blue hedgehog with spiky hair. Sonic was Sega’s answer to the wildly popular “Super Mario” game series created by Nintendo.

Sonic became a mega hit for Sega, but Naka didn’t feel he got credit for contributing to the company’s financial success. He left the parent company to join the American Sega Technical Institute, developing new iterations of “Sonic”, only to return to Sega and Japan in 1994.

In 2006, Naka left Sega again to launch his game company Prope, which made games for the Nintendo Wii device. He joined Square Enix in 2016 but left the company earlier in 2022 after being removed as director of the game “Balan Wonderworld”.