Around 50 million yen withdrawn in 1998 by a firm affiliated with a prefectural and municipal employee union is missing, sources familiar with the case said Monday.

The funds were reportedly aimed at measures to deal with rightist groups.

After making up for the missing money, the All Japan Prefectural and Municipal Workers' Union filed a criminal complaint against a former official of the affiliate firm, UBC, on suspicion of embezzlement.

The revelation came one day after it was discovered that the union may have skimmed about 220 million yen from some 300 million yen in commissions received for a mutual aid program via a dummy firm. over several years through 1999.

The former official of UBC, which is based in Shinjuku Ward, Tokyo, served as a special member of the union's executive committee at the time of the shady transaction, according to sources.

Around August 1998, rightist groups caught wind of an insurance fraud by a former vice chairman of the Osaka Prefectural Workers' Union and told the parent union it would dispatch loudspeaker vans to union headquarters and its annual convention to criticize the union over the case.

The former UBC official, who was not identified, took part in meetings of top union officials to discuss how to deal with the matter and in early September 1988 instructed a subordinate to withdraw 50 million yen from UBC's bank account because the money "became necessary to deal with the Osaka issue," the sources said. About a month later, the official had union headquarters pay back the amount, but union executives said they have no idea what the original money was used for.

UBC was set up in 1983 to handle the administrative affairs of the union. Its major shareholders are the union headquarters and its mutual aid bodies, and the union chairman has traditionally served as its president.

Regarding the 220 million yen in missing commissions, investigative authorities are questioning senior union officials to learn the flow of money and how it was used, sources said. The Tokyo-based insurance agency was liquidated in January 1999 after suspicious accounting procedures came to light.

The union's operational headquarters had been managing long-term mutual aid for its members, but around 1992 it concluded a reinsurance contract with the predecessor of Axa Life Insurance Co., using the Tokyo-based dummy insurance agency as an agent.

The union allegedly concluded the contract as a step to lower its risk in times of disasters and other emergencies.

The insurance agency had been receiving consignment commissions from Axa Life's predecessor, the sources said.

The commissions rose as the number of mutual aid members grew, reaching about 300 million yen. the sources said.

However, only about 80 million yen of the total was accounted for as commissions received by the headquarters, they said.

The headquarters had been conducting the actual day-to-day operations, such as recruitment, while the agency merely received the commissions according to insurance business law, which states that only agencies can receive commissions.