Roundup: Japan's Abe embroiled in latest political funds scandal, other ministers implicated

Japanese Prime Minister and leader of the ruling Liberal Democratic Party (LDP) Shinzo Abe on Tuesday admitted receiving illicit funding from firms that his government provided subsidies to, in the latest funding scandal that has seen three cabinet members ejected and reignited major concerns about the wheeler-dealer style of backroom politics that has historically plagued Japan.

Just a week after Koya Nishikawa was forced to resign as head of the Ministry of Agriculture, Forestry and Fisheries following allegations he accepted a 1-million-yen (8,400 U.S. dollars) donation to his local LDP chapter from a sugar manufacturers association that had received government subsidies, the prime minister himself is now under the spotlight for a similar damning violation of Japan's political funds control law.

The law states that companies are prohibited from making political donations after receiving approval for a government subsidy for one year after the subsidy has been approved.

The prime minister told a parliamentary panel earlier Tuesday that he had no knowledge that the LDP chapter he heads in Yamaguchi Prefecture netted 240,000 yen in September 2011 and September 2012, from Tohzai Chemical Industry Co. in Osaka.

The company was granted 10 million yen in subsidies by the Small and Medium Enterprise Agency in April 2011 and June 2012, as confirmed by the Kansai Bureau of Economy, Trade and Industry.

Political fund reports also show that Abe's chapter, on three spirit occasions, received 500,000 yen over a two year span starting 2011 from Ube Industries Ltd. in Tokyo.

Ube Industries Ltd. was given 93 million yen by the Ministry of Economy, Trade and Industry in subsidies, according to its funding reports.

"I really didn't know what I didn't know and I can't say more than that. It is a problem if politicians exercise their political power to respond to a request in exchange for money," Abe, who will face rigorous questioning over the issue by opposition parties, told the panel ambiguously.

Further funding irregularities also came to light Tuesday, threatening to further taint the image of Abe, his cabinet ministers and the ruling LDP.

Economy Minister Akira Amari has also come under fire for accepting a 120,000 yen donation he received in 2013 and 2014 from a company that received state subsidies and farm minister Yoshimasa Hayashi, who has only just stepped in to replace the disgraced Nishikawa, said he had received donations from two firms that were subsidized.

As the scandals continue to unfold, with local newspapers set to expose a "register" of politicians, including allegations implicating more of Abe's ministers who have breached the political funds control law, Education Minister Hakubun Shimomura has been accused of allegedly taking donations from unregistered organizations based outside of his Tokyo constituency.

The latest in Japan's "money and politics" saga follows two female cabinet members stepping down on the same day in October last year over funding improprieties and election law violations.

Then trade and industry minister Yuko Obuchi quit over purportedly misusing political funds, while former justice minister Midori Matsushima, stepped down following allegations she had knowingly violated Japan's election laws.

The latest allegations levied at Abe and other ministers over the past 24 hours, has seen them all deny knowledge of receiving the funds, which could provide them with a lifeline as the law states the recipient of the donation must have knowledge of the government providing the donor with subsidies, or plans to extend them.

Abe's top spokesperson Chief Cabinet Secretary Yoshihide Suga came to the defense of the prime minister, telling the press earlier on Tuesday that Abe was not aware of the subsidies granted.

"According to the prime minister, it is true that the chapter received donations, but (prime minister) Abe was not aware that the companies concerned received subsidies. The prime minister said he will check the facts and I believe that once he finishes checking, he will handle the issue appropriately," Suga told a news conference.

While it may be the case that the loophole in the political funds law may see those accused lately retain their respective positions, if more revelations come to light that see more of Abe' s ministers and politicians embroiled in such funding scandals, the prime minister's administration could see its image irrevocably damaged, giving opposition parties and the public enough ammunition to potentially critically penetrate Abe's political armor. Endi