Prosecutors raided the homes and offices of Osaka oil wholesaler Junichi Izui and executives of Mitsubishi Oil Co. and Mitsui Mining Co. Jan. 9 who were arrested Jan. 8 on suspicion of fraud involving 2.39 billion yen.The Tokyo District Public Prosecutor’s Office said it is filing fraud charges against the 60-year-old Izui, who has already been charged with income tax evasion. The two executives arrested were Takeshi Otsuki, 49, former deputy chief of Mitsubishi Oil Co.’s Tokyo branch, and Masanori Kozuma, 45, former deputy director of Mitsui Mining Co. Prosecution sources alleged that Otsuki received tens of millions of yen in kickbacks from Izui. Both he and Kozuma were taken to the Tokyo Detention House on late Jan. 8.The fraud charges involve a total of 2.39 billion yen the three are believed to have received from Mitsui Mining after the company remitted the money to Izui’s Daiwa Bank account between May and August of 1995, the prosecutors said.The prosecutors searched Mitsubishi Oil’s head office in Tokyo’s Minato Ward, Otsuki’s home in Kamifukuoka, Saitama Prefecture, and other locations in a bid to collect evidence that the three conspired to defraud a massive sum from Mitsui Mining, they said. A Mitsubishi Oil spokesman said the company deplores Otsuki’s arrest. Representatives of Mitsui Mining declined comment, saying only that subsequent investigations by authorities will reveal the truth.Izui, owner of Izui Sekiyu Shokai and known for his close ties with influential lawmakers and bureaucrats, was first arrested Nov. 7 on suspicion of evading 330 million yen in income tax between January 1992 and December 1994. Among the undeclared income is money believed to have been paid as commission on deals involving several companies, including Mitsui Mining and Mitsubishi Oil.In the three years up to 1995, Mitsubishi Oil reportedly provided as much as 4 billion yen to Izui, purportedly as commissions on oil transactions between Mitsubishi Oil and several companies. Mitsubishi Oil and Mitsui Mining are embroiled in a civil lawsuit over 2.38 billion yen allegedly funneled to Izui through a lucrative buyback scheme.Under the scheme, Mitsui paid in advance an amount specified by Mitsubishi Oil to Izui’s company as commission and Mitsubishi Oil paid back the money and additional commissions to Mitsui Mining afterward, according to documents filed in the suit. But in the latter half of 1994, Mitsubishi Oil allegedly requested that the scheme be changed so that Izui directly would return the money to Mitsui Mining, reportedly arguing that “under the old method the supply of huge funds has become impossible.”Izui Sekiyu Shokai, set up by Izui in 1977, has made political donations or purchased tickets for fundraising parties for at least five Lower House members, including Taku Yamasaki, chairman of the policy affairs research council of the ruling Liberal Democratic Party.

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