Widening Political Scandal in Japan Topples a Governor

The widening political scandal that ousted Japan’s most powerful politico from party office last week toppled another official Tuesday, as the governor of Niigata Prefecture resigned amid allegations that he took $2.4 million in unreported campaign contributions from a trucking company.

Gov. Kiyoshi Kaneko would neither confirm nor deny that he had taken the money from the Kyoto-based Sagawa Kyubin group. But he said he was resigning to accept political and moral responsibility for the “disorder” created in his prefecture on the Sea of Japan coast.

Also Tuesday, the newspaper Mainichi Shimbun reported that Transport Secretary Keiwa Okuda took $800,000 from one of the companies in the scandal-ridden trucking group. Okuda angrily denied the report, although he has said he would “reserve comment” on whether he received an individual rather than corporate donation from someone at the Tokyo Sagawa Kyubin Co.

As prosecutors widen their probe into what could be the most explosive political scandal since World War II, Prime Minister Kiichi Miyazawa and his Cabinet members repeated their denials of involvement. Chief Cabinet Secretary Koichi Kato said the Cabinet has no plan to investigate whether its members took money from Sagawa in violation of the Political Funds Control Law.

That law limits annual contributions to all political candidates to $1.2 million for corporations and $240,000 for individuals. It also requires disclosure of all contributions greater than $8,100. Violations are punishable by five years in prison or a maximum fine of $2,450. No politician has yet been charged with violating the law in connection with the Sagawa scandal.

But the scandal is alleged to involve hundreds of millions of dollars in shady donations, an organized crime syndicate and several of Japan’s top politicians. Some reports say as many as three former prime ministers were on the take.

Last week, the man regarded as Japan’s political kingmaker, Shin Kanemaru, resigned as vice president of the Liberal Democratic Party after admitting he took $4 million in unreported donations from Sagawa.

Prosecutors allege that the Tokyo operation of Sagawa Kyubin, Japan’s second-largest package delivery service, made about $4 billion in loans and loan guarantees to front groups for organized crime. Hundreds of millions of dollars are believed to have been kicked back to Sagawa and funneled into a political slush fund.

Niigata Gov. Kaneko, 60, is believed to have accepted the $2.4 million before his 1989 gubernatorial campaign. An independent backed by the ruling party, he has categorically denied receiving any money from the group on four different occasions since the scandal broke last August. Prosecutors believe the Kaneko campaign kept $800,000 and funneled the rest to a ruling party candidate in Niigata who has since died.