Japan’s Racketeering Scandal Widens

Mitsubishi Motors Corp. executives Atsushi Ueba, 56, former head of the company’s general affairs department, and department members Yuichi Ueki, 43, and Shoichi Shima, 38, were arrested on suspicion of having made large payoffs to racketeers. The arrests mar the image of Japan’s export industry, which is one of the few sectors doing well in an otherwise sluggish economy. This year, Japan’s four leading brokerages and one of its largest banks have been implicated in payoff scandals. Mitsubishi Motors President Takemune Kimura said at a news conference that he regrets the arrests of the three, that they paid a total of $194,000 to sokaiya racketeers and that top Mitsubishi executives were unaware of the transactions. Sokaiya demand cash in return for not disrupting a company’s shareholder meetings. Kimura said he would move to improve oversight within the company to prevent such a situation from occurring again. Also this week, two former executives of brokerage Nikko Securities Co. were arrested on suspicion of making payoffs to a gangster in 1995, and Hideo Itokawa, 58, director of retailer Matsuzakaya Co., was arrested on suspicion of paying off a reputed gangster.