The Tokyo High Court on Wednesday upheld a lower court-imposed 10-year prison term against Upper House member Tatsuo Tomobe for swindling 35 people out of about 665 million yen between 1994 and 1996 through a bogus mutual fund scheme.

Tomobe, 72, an independent Diet member who has refused to resign his seat despite being incarcerated since his 1997 arrest, was convicted in March by the Tokyo District Court of defrauding depositors of his mutual aid association, Orange Kyosai Kumiai.

The high court also upheld five-year prison terms handed to Tomobe's wife, Mikiko, 65, who served as Orange Kyosai's managing director, and Matsunosuke Ishizaki, 66, its president, for conspiring with Tomobe in the fraud.

Tomobe and his wife appealed the district court decisions, arguing that they believed at the time that they could return the money and the promised interest.

Tomobe also claimed that he did not know that the money they collected was spent to buy his way into the Diet and for his personal expenditures.

In upholding the sentence, presiding Judge Tomoo Araki said Tomobe was "deeply involved" in the fraud from the beginning and denounced his claims to the contrary.

The 10-year prison term is the longest ever handed down to an incumbent Diet member in the postwar period. Tomobe has continued to snub a nonbinding Upper House resolution issued in 1997 calling for his resignation.

Prior to Wednesday's ruling, the judge asked Tomobe if he would resign his seat to take responsibility for the fraud. When Tomobe refused, reasoning that resigning would be tantamount to admitting guilt, the judge replied, "There seems to be no use in saying anything further to you."

According to the high court, Orange Kyosai began selling a financial product named Orange Super, which offered yields of around 7 percent, much higher than regular bank interest, in 1995.

Of the money Tomobe collected from depositors, he allegedly spent at least 276 million yen to pay his election campaign debts and family expenditures, and to buy his way into the Diet. The association went bankrupt in November 1997.

During Tomobe's lower court trial, prosecutors said the total amount Tomobe swindled over a period of five years and eight months since 1991 came to around 6 billion yen, causing huge losses for many investors.

Tomobe and Orange Kyosai officials told investors the money was invested overseas and claimed the fund is trustworthy because the organization is run by a Diet member.

Tomobe, who was elected to the Upper House from the now-defunct Shinshinto in 1995, said before the ruling that he accepts full responsibility for losses he "unintentionally" caused depositors to suffer and would make an effort to refund the money.

Tomobe's Upper House term runs until July, and he continues to draw a salary of some 2.37 million yen each month. He has received a total of 142 million yen from the state coffers as a lawmaker since he was arrested in January 1997, including bonuses and a communication allowance intended to pay for newsletters and such.

His two secretaries are still paid 10 million yen each per year in public money.