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The Foreign Ministry’s former head of logistics for VIP trips abroad pleaded guilty in court Tuesday to defrauding the government out of some 161 million yen by padding expenses of overseas visits by two former prime ministers between 1997 and 1999.

During his first hearing before the Tokyo District Court, Katsutoshi Matsuo, the 56-year-old former head of the now-defunct Overseas Visit Support Division, admitted that he pocketed money from so-called discretionary diplomatic funds.

Matsuo, who was fired by the ministry in January, is accused of defrauding the government out of 506.7 million yen between 1997 and 1999 in connection with 14 overseas trips by Ryutaro Hashimoto and the late Keizo Obuchi.

Appearing in court in a navy blue suit and a white shirt, Matsuo issued a public apology for swindling taxpayers’ money and for abusing his role as a senior government official.

The case has undermined public trust in the ministry’s operations and has led to the discovery of a rash of other financial wrongdoings by ministry bureaucrats.

“I apologize for troubling the Cabinet, the Foreign Ministry and the general public, and I would like to spend the rest of my life compensating them,” he said.

In their opening statement, prosecutors charged that Matsuo pocketed 161 million yen from the secret diplomatic funds between October 1997 and February 1999 by padding expenses such as hotel bills during seven overseas trips by Hashimoto and Obuchi.

The secret funds were meant to cover clandestine government activities — such as information-gathering — and were allocated to the Foreign Ministry, the Cabinet Secretariat and other government organs through the secretariat’s coffers.

Matsuo carried out his scam by submitting false receipts to the secretariat and being reimbursed for expenses that were never incurred, according to prosecutors.

During a trip by Hashimoto to Saudi Arabia in November 1997, for example, Matsuo falsely claimed that hotel bills incurred by the prime minister’s staff amounted to 7.1 million yen. The employees stayed at the Saudi government’s public guest house free of charge, prosecutors said.

Matsuo banked some of the money he had claimed, using it to purchase several racehorses, among other items, prosecutors said.

Matsuo’s lawyers, however, said he used a portion of the money to cover some of the costs incurred during the VIP visits, so he did not pocket the entire 161 million yen.

Matsuo has also been indicted for defrauding the government out of 345 million yen between 1997 and 1999. This indictment relates to two Group of Eight summits, in 1998 and 1999, along with other prime ministerial trips by Hashimoto and Obuchi.

He is awaiting trial on these charges before the same court.

While head of the support division between 1993 and 1999, Matsuo oversaw the logistics arrangements for some 46 foreign trips by six prime ministers.

He is believed to have swindled the government out of about 800 million yen during this period, but prosecutors called a halt to investigations of overseas trips before 1997 due to difficulties over evidence.

Matsuo is believed to have spent the money on more racehorses, golf course memberships, a luxury condominium and other items.

His alleged fraud came to light in January and he was fired later the same month after the ministry determined, via an initial internal investigation, that he had pocketed at least 54 million yen. He was arrested in March.

A former subordinate of Matsuo’s, 45-year-old Hiromu Kobayashi, and another official were arrested earlier this month on suspicion of defrauding the government out of 22 million yen. by padding limousine service expenses during last year’s G8 summit in Okinawa.

Makoto Mizutani, former consul general to Denver, was fired on similar grounds last week.

Mizutani, 52, is believed to have swindled $81,000 in public funds by pocketing money allocated for the renovation of his official residence. He is also believed to have taken some of the funds earmarked as the salary of a part-time member of his staff.

During a regular news conference Tuesday morning, Foreign Minister Makiko Tanaka, who promised to conduct a thorough reform of the ministry’s operations in the wake of the Matsuo scandal, said she deeply regrets the incident and its effect on the public’s trust in the ministry.

“Each member of the ministry’s staff must change their mind-set. . . . Otherwise the financial problems will not be solved,” she said.

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