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Police on Sunday arrested a top leader of Sumiyoshi-kai, one of Japan’s largest yakuza groups, for allegedly conspiring to obstruct compulsory seizure of assets by creditors, officials said.

Sumiyoshi-kai chairman Hareaki Fukuda, who had been sought by police since Friday when they obtained an arrest warrant on him, showed up at the Metropolitan Police Department headquarters Sunday morning. He reportedly told investigators that he had nothing to do with any such conspiracy.

It was the first time in 36 years that a chairman of Sumiyoshi-kai, which comprises about 10,000 members in 20 prefectures throughout Japan, has been arrested. Fukuda has served as chairman since 1998 and is believed to be the No. 2 leader of the syndicate.

On Friday, officers arrested five others in connection with the case, including 67-year-old Kitaro Watanabe, president of Azabu Tatemono, a Tokyo-based real estate firm, who allegedly obstructed the seizure and issued false statements in official documents in May 1999.

Also arrested were Kinjiro Kaneko, 70, a “sokaiya” racketeer known for close ties with the Sumiyoshi-kai gang, and Takeko Nakamura, a town assembly member in Yasato, Ibaraki Prefecture.

Fukuda and the five others allegedly conspired to submit the documents to authorities and establish false mortgages worth 530 million yen on properties owned by Kaneko in Yokosuka, Kanagawa Prefecture.

Kaneko had purchased the properties in 1997 for 450 million yen and was using them for his industrial waste disposal firm. When the company plunged into financial difficulties in 1999, Kaneko and the others tried to establish the false mortgages on the properties to avoid seizure by its creditors, police officials said.

Police suspect that Fukuda and Watanabe, who had also lent money to Kaneko, feared that if Kaneko’s properties were seized by creditors, they might be unable to collect their own funds.

In January this year, a “shinkin” bank in Kanagawa Prefecture, which had lent 140 million yen to Kaneko’s firm, eventually seized the properties and sold them to a Yokohama firm in an auction.

Azabu Tatemono was a major borrower from the “jusen” housing loan companies that went bankrupt under the weight of bad real estate loans racked up during the bubble economy of the late 1980s. The firm has also been known for alleged close ties with the Sumiyoshi-kai gang.

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