A former Finance Ministry bank inspector pleaded guilty and another partially denied guilt Monday as they were arraigned before the Tokyo District Court for allegedly receiving 12.8 million yen in bribes from major banks.

In a scandal that rocked the nation’s most powerful institution to its core, Koichi Miyagawa, 53, and Toshimi Taniuchi, 49, are alleged to have given officials from six banks their inspection schedules and the names of branches to be inspected in exchange for being provided lavish dinners, golf outings and other favors.

The two bureaucrats, in dark suits, no ties and roped at the waist, were led into the courtroom by uniformed guards Monday afternoon.

As a prosecutor read out the indictments, Miyagawa once glanced at her, while Taniuchi looked down through the session. Taniuchi pleaded guilty to all the charges leveled against him. Miyagawa, on the other hand, admitted to most counts of bribery, but denied that a discount on condominium he purchased in 1996 through a subsidiary of Asahi Bank amounted to a bribe.

Prosecutors allege that Miyagawa had Asahi Bank find a condominium for him through its subsidiary and bought it at 50 million yen when the actual price was 54.4 million yen. “I did not know that the apartment was worth 54.4 million yen,” he said. “I did not know that Asahi Bank discounted it to show appreciation to me for telling (bank officials) when the inspection dates would be.”

Miyagawa also denied charges that he gave Sanwa Bank tips on bank inspections in return for being wined, dined and otherwise entertained to the tune of 558,000 yen. “I never told Sanwa about bank inspection dates or gave the names of branches to be inspected,” Miyagawa said. “Nor had I ever given them any preferential treatment.”

Miyagawa was chief of the Financial Inspector’s Office and Taniuchi was deputy head of the Financial Inspection Department’s Control Division. The two were dismissed from the ministry in mid-February.

Prosecutors allege that Miyagawa received 8.26 million yen in the form of wining, dining and other favors from Asahi Bank, Dai-Ichi Kangyo Bank, Sumitomo Bank and Sanwa Bank between March 1993 and last June.

Taniuchi allegedly received 4.53 million yen worth of similar favors from Sanwa, the defunct Hokkaido Takushoku Bank, Tokyo-Mitsubishi Bank, Sumitomo and DKB from September 1993 through last September.

The case gained notoriety as allegations emerged that Miyagawa was dined at a restaurant where waitresses wear no underpants. The scandal forced the ministry’s top two leaders to resign, triggered calls for a new law mandating an ethics code for public servants and even resulted in the suicide of one ministry official.

Monday’s session was the start of a series of bribery trials involving bureaucrats and financial businesses. In addition to Miyagawa and Taniuchi, four officials, including an elite Finance Ministry bureaucrat and Bank of Japan official, are awaiting trials for allegedly receiving bribes from banks and brokerages.

Also, eight employees from four banks have been fined by the Tokyo Summary Court for passing bribes to Miyagawa and Taniuchi. Prosecutors decided against indicting the other bank officials based on the small bribe amounts.

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