What appears be a blatant case of embezzlement at a Saitama office of Japan Highway Public Corp. was hushed up last year — an episode that observers say illustrates how the heavily indebted corporation, now at the center of a privatization debate, pays little heed to the fact that it is dealing with public funds.

An official at Japan Highway’s Urawa Construction Office was pressured by his superiors to resign in September 2001 after they found out that he had paid 6 million yen of the corporation’s funds for what was actually a 1.3 million yen purchase of office supplies at the end of fiscal 2000, and allegedly pocketed the 4.7 million yen difference returned by the supplier.

The identity of the man and the supplier have been confirmed by The Japan Times but are being withheld.

The supplier delivered just 1.3 million yen worth of goods, including photocopy paper.

The official had been transferred to another Japan Highway office in a different prefecture by the time the Urawa office realized it did not have 6 million yen worth of stationery in its stock.

In August last year, the Urawa office confronted the official, who promptly admitted he pocketed the money and paid it back in full, according to Japan Highway.

Japan Highway, however, has hushed up what appears to be a case of blatant embezzlement.

The company did not call the police, and even allowed the official to receive his retirement allowance upon his departure, accepting his argument that he only “temporarily kept the money.”

Japan Highway quoted the official as saying he received the 4.7 million yen in cash, instead of stationary supplies, so that the money “could be used flexibly” for the Urawa office in the new accounting year.

A spokesman for Japan Highway admitted that the official’s action of taking funds reimbursed by a supplier was “inappropriate,” which is why he was “urged” to quit.

The case went unreported until The Japan Times recently made an inquiry with Japan Highway.

“The incident illustrates the nature of Japan Highway. They couldn’t care less about the fact that they are using public money,” said Satoshi Shinkai, secretary general of the National Liaison Conference for Citizens’ Ombudsmen, a body of more than 80 citizens’ groups monitoring the national and local governments.

Japan Highway is a semi-governmental body run with trillions yen in government loans injected from the “zaito” government loan program, which is largely financed from the postal savings and insurance systems.

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