Hosokawa Ally Acknowledges Taking Money From Suspect Japanese Firm

Prime Minister Morihiro Hosokawa’s most powerful ally acknowledged Monday that he accepted donations from a construction company under investigation for bribing politicians, but he denied any wrongdoing.

Allegations surfaced last week that Ichiro Ozawa, a powerbroker behind Hosokawa’s coalition government, took the equivalent of more than $46,000--possibly on several occasions--from construction giant Kajima Corp.

The accusations have become a major embarrassment for Hosokawa, who took office in August promising to stamp out corruption. He has vowed to enact a political reform bill before year’s end.

Ozawa admitted meeting with Shinji Kiyoyama, a Kajima vice president who was arrested last month on suspicion of bribing the mayor of a northern city, and said he received donations from the company.

Ozawa said the money was “all handled in accordance with the law,” and he denied taking “regular, periodic” donations. But he refused to disclose how much money he received or when he received it.

Before becoming co-leader of the new Japan Renewal Party earlier this year, Ozawa, 51, was a powerbroker in the Liberal Democratic Party. After 38 years in power, the scandal-plagued Liberal Democrats lost their parliamentary majority in elections in July.

A report in the daily Asahi Shimbun last week alleged that Ozawa received 5 million yen, or $46,000, from Kiyoyama twice a year and had personally accepted a gift of that amount in December.

Hosokawa has said he would resign if the reform bills, which would restrict corporate donations, did not pass by the end of this year. But the Liberal Democrats could use the accusations against Ozawa to stall debate on the reform package, which they oppose.