Sonic The Hedgehog Creator Yuji Naka Reportedly Arrested For Insider Trading

Famed game creator Yuji Naka is reportedly in custody following allegations that he was involved in insider trading. According to Nintendo Life's report yesterday, Naka — a co-creator of the beloved "Sonic the Hedgehog" game series and likeness — allegedly purchased stock in Aiming, a Japanese developer that was gearing up to release a new installment in the popular series "Dragon Quest." According to Nintendo Life, Naka's stock purchases — 10,000 shares in total — clocked in around $20,000.

Naka's arrest is part of a broader insider trading investigation, which also resulted in the arrests of Taisuke Sazaki and Fumiaki Suzuki — employees of "Dragon Quest" publisher and co-developer Square Enix. Suzuki and Sazaki are also accused of purchasing Aiming stock shortly before the game's release. A report from Fuji News Network says that critical and not yet public details surrounding the upcoming "Dragon Quest" smartphone game were acquired by or shared with Naka, prompting the Aiming stock purchase.

There does not appear to be information available on whether Naka is still in custody, or if he still holds the shares in question.

Naka's creation, "Sonic the Hedgehog," become a national icon and an incredibly successful franchise during his time as the lead developer at longtime Japanese video game developer, Sega. But in 2006, he left the well-known name to embark on a new journey founding his own game studio — Prope. For over 10 years, Prope put out a moderate roster of games, including a couple on the Wii, "Digimon Adventure," and "Ivy the Kiwi."

However, Naka jumped ship from his own studio abruptly in 2018, and the studio went bankrupt shortly after, per Siliconera. Prope was being left to its own devices by its maker in exchange for a role at Square Enix, but this leg of Naka's tenure was short-lived, and he announced his departure from Square Enix in mid-2021 (via Eurogamer). At the time of his departure, Naka had said he "can't talk about the reason right now." The "Dragon Quest Tact" mobile game at the heart of Naka's alleged insider tradition was released in July of 2020.

The Naka-Square Enix chaos doesn't end there. Earlier this year, the legendary Sonic developer announced that he was suing Square Enix for the abysmal flop of his last game, "Balan Wonderworld," which underperformed in markets across the world on its opening week. According to Video Games Chronicle, Naka blames Square Enix for releasing the game while still developmentally unfinished. Per Fuji News Network, the Tokyo District Public Prosecutors Office is investigating the ongoing situation as part of a larger look into insider trading at Square Enix, where two other executives have also been arrested.