Stricter Penalties Considered for Japanese Politicians in Cases of Funds Law Violations; LDP Considers Ban of Fundraising Parties

Yomiuri Shimbun file photo
The Liberal Democratic Party’s headquarters in Chiyoda Ward, Tokyo.

The Liberal Democratic Party is considering revising the Political Funds Control Law to strengthen penalties for Diet members and other politicians if they are found to have violated the law, according to LDP sources.

The ruling party is mulling the revision amidst the ongoing scandal over alleged violations of the law involving its factions. It aims to introduce a framework under which politicians will also be held responsible if the accounting managers of political organizations they represent are found to have committed serious violations — even if collusion has not been found. They could therefore be subject to penalties such as having their civil rights suspended.

The LDP aims to pass a bill to revise the law during the ordinary Diet session to be convened on Jan. 26, after discussing details of the envisioned framework with junior coalition partner Komeito and opposition parties, the sources said.

Under the current Political Funds Control Law, penalties are imposed on accounting managers of political organizations if they are found to have failed to record, or have falsely reported, income or expenditures in the political funds reports, because these managers are obliged to make correct statements.

It has been pointed out that it is hard to build a criminal case against the lawmakers who represent such organizations, because prosecutors have to prove that they colluded with their accounting managers by, for example, giving them clear instructions, approving misconduct or receiving detailed reports.

As there can be cases in which accounting managers inadvertently fail to report income or expenditure, the LDP plans to create guidelines as to how and when the framework should be applied depending on how malicious the misconduct is. It has been proposed that politicians should be held responsible if their accounting managers have been indicted and found guilty.

Prime Minister Fumio Kishida, who also serves as LDP president, has established a political reform headquarters at his party. In its meetings, some members pointed out that politicians have avoided punishment in previous cases of violations of the Political Funds Control Law because their secretaries who also served as accounting managers usually ended up being the only ones held criminally responsible.

Based on its discussions, senior LDP members have concluded that it is necessary to introduce more strict measures under the law, according to the sources.

Komeito is also advocating that politicians should be held more responsible under the law, referring to the guilt by association system stipulated in the Public Offices Election Law. Under this, a politician’s election victory can be invalidated if their secretary or someone close to them is found to have violated the law.

Meanwhile, as a measure to review the faction system, the LDP is making arrangements to introduce a policy of banning factions from holding political fundraising parties, according to the sources. Currently, the factions are refraining from holding such events.

As the latest scandal is connected to the fundraising parties held by factions, the party believes that it will not be able to gain public understanding if they are allowed to continue holding such events.

The LDP aims to prevent a reoccurrence of a similar scandal by cutting off a major source of income for factions and restricting their capacity to raise funds and distribute the money to their members. The party is considering specifying the ban on holding fundraising parties by factions in its governance code, as well as prohibiting their involvement in the appointment of Cabinet members and party executives, according to the sources.