Yuji Naka, the developer of Sonic, was detained in an insider trading case.

According to the Fuji News Network, Yuji Naka, the well-known co-creator of Sonic the Hedgehog, has been arrested in Japan in connection with an insider trading investigation involving former Square Enix employees.

Taisuke Sazaki, a former Square Enix employee, is at the centre of the controversy after learning that Square Enix and Aiming collaborated on the development of the smartphone game Dragon Quest Touch. Prior to the project's official launch on February 5, 2020, Sazaki and another former Square Enix employee, Fumiaki Suzuki, are said to have purchased 162,000 shares of Aim between December 2019 and February 2020 for about 47.2 million yen (about $336,760).

Naka is alleged to have purchased 10,000 shares of Aiming before it was made public for 2.8 million yen ($20,000). He collaborated with Square Enix between 2018 and 2021 on the video game Balan Wonderworld. Regarding allegations of insider trading, the three men have now been detained.

Following the arrests, Square Enix issued a formal statement in which it stated that company has been "completely cooperating" with all demands from the Securities and Exchange Surveillance Commission. "We sincerely regret the considerable worry this has caused for all parties involved. We have handled this situation seriously, taking internal disciplinary action against the allegedly responsible workers.