Tokyo Prosecutors Raid Offices of Liberal Democratic Party’s Abe, Nikai Factions Over Kickback Scandal (UPDATE2)

The Yomiuri Shimbun

10:21 JST, December 19, 2023 (updated at 17:00 JST)

The special investigative squad of the Tokyo District Public Prosecutors Office on Tuesday raided offices of the Liberal Democratic Party’s Abe and Nikai factions in Chiyoda Ward, Tokyo, over allegations that they created hidden funds with cash generated by political fundraising parties.

The allegations, which would constitute violations of the Political Funds Control Law, have led to the replacement of key Cabinet ministers. They have also developed into two criminal cases involving the 99-member Abe faction and the 40-member Nikai faction.

The two factions are suspected of falsely reporting, or not reporting at all, income and expenditures on political funds reports. Prosecutors deemed it necessary to raid their offices to seize relevant documents, suspecting that the alleged wrongdoing was conducted on a systematic, repeated basis.

According to sources, the largest Abe faction — also known as Seiwa Seisaku Kenkyukai — provided its members with cash equaling the amounts by which they had exceeded their quota for party ticket sales, but neither the faction nor the members included the cash in their political funds reports.

The kickbacks are estimated to have totaled ¥500 million over the five-year period from 2018 to 2022, a time for which the statute of limitations does not apply.

The faction’s treasurer admitted to the special investigative squad during voluntary questioning that they did not include the amounts in reports and also explained how kickbacks were paid out. The treasurer is said to have asked the faction members not to report the cash, prompting the prosecutors to suspect the faction took the initiative in the wrongdoing.

Dozens of Abe faction members are suspected of receiving hidden funds, including former Education, Culture, Sports, Science, and Technology Minister Ryu Shionoya, former Chief Cabinet Secretary Hirokazu Matsuno, former Economy, Trade and Industry Minister Yasutoshi Nishimura, LDP Diet Affairs Committee Chairperson Tsuyoshi Takagi, LDP House of Councillors Secretary General Hiroshige Seko and LDP Policy Research Council Chairperson Koichi Hagiuda.

Cabinet ministers have been replaced, and LDP leadership members have submitted their resignations.

The Nikkai faction — also known as Shisuikai — is the party’s fifth-largest. It is suspected of having reported at least ¥100 million less in party income than actually garnered over a five-year period.

As with the Abe faction, the Nikai faction had paid kickbacks to its members, but the money was reported in the faction’s expenditures and as part of the members’ incomes. The faction’s treasurer is suspected of having intentionally excluded a portion of the party income from the total, and that part may have become hidden funds within the faction.

Prosecutors have been questioning Abe faction members who received large kickbacks. They will analyze the seized documents to confirm the circumstances, the process by which the money was not reported, and who was involved.

Abe, Nikai factions apologize

The Abe and Nikai factions issued a statement of apology Tuesday regarding prosecutors’ searching of their offices.

“We heartily apologize for impairing trust toward politics. We will take the matter seriously and cooperate to the fullest with investigative authorities,” the Abe faction’s statement said.

Former LDP Secretary General, Toshihiro Nikai, who leads the Nikai faction, said in a comment issued on the day that “our secretariat and members will provide serious cooperation to requests from investigative authorities, and work to resolve the issue.”