After earlier denials, Hokkaido police officially came clean and admitted in early March that one of the force’s stations had misappropriated funds meant for rewarding informants.
The revelation came four months after accounting records of the misdeeds were leaked to local media. But was this an isolated case of wrongdoing or evidence of systemic malpractice nationwide?
Hokkaido police admitted, in an interim report on an in-house probe released March 12, that Asahikawa Chuo Police Station officials used money for other purposes in 1995 and 1997 that had been allocated for people who provide information or contribute to investigations. The media had received a photocopy of accounting records and receipts in November that later turned out to have been faked.
While the Hokkaido force claimed the wrongdoing only involved the Asahikawa station, insiders said misappropriations of police funds budgeted for investigations and other purposes is a common practice nationwide.
After the interim report was released, Hokkaido Gov. Harumi Takahashi asked the local board of audit to scrutinize how the prefectural police headquarters and all branch stations spent the reward, travel and other expenses between 1998 and 2003.
What apparently prompted the Hokkaido force to reverse its initial denial was testimony March 4 before the prefectural assembly by Koji Harada, 66, a former chief superintendent of the force and one-time head of the Asahikawa Chuo Station.
Harada testified that throughout his career in the police force, he witnessed and also benefited from secret funds systematically skimmed from the informant reward budget.
The unprecedented whistle-blowing by a former ranking official was followed by the release of information by Kunio Saito, 56, a former deputy head of the Teshikaga Police Station in eastern Hokkaido who unveiled secret records he had kept on misappropriations while he was at the station from 2000 to 2001.
In a statement released to the media, Harada criticized the Hokkaido force for trying to lay the blame solely on Asahikawa Chuo officials.
During the March 4 prefectural assembly session, Harada said he was paid an allowance out of slush funds not just while he was at the Asahikawa station but also during his stint at Hokkaido police headquarters and at the National Police Agency.
“The attitude (of Hokkaido police headquarters) to blame everything on lower echelons may further erode rank-and-file investigators’ morale,” Harada said.
Since last year, more than a dozen former and serving police officers from around the country have informed the media on an anonymous basis that they either misused or witnessed the misuse of investigative rewards.
However, Hiroto Yoshimura, chief of the NPA secretariat, told a Diet session March 16 that the agency has no plan to investigate similar alleged misdeeds at other prefectural forces, saying police are too busy combating terrorism and other crimes.
In a written response to The Japan Times, the NPA denied any involvement in fund misappropriations.
In principle, accounting reports on informant and other outlays for police investigations are kept confidential. Officers who used such money legitimately have been traditionally allowed to put faked informant names on receipts to protect their sources, according to police.
The national and prefectural boards of audit annually check whether police forces properly spend the money allocated for such purposes, but the Hokkaido and other alleged cases of misuse were not detected.
In 2002, 5.1 billion yen was paid from national coffers to prefectural police forces for investigative rewards, and the forces received an additional 2.5 billion yen from local governments, according to NPA.
Akira Ouchi, 45, a former accounting clerk with the Metropolitan Police Department, said that the Hokkaido cases support his belief that investigation reward money is routinely misused, and that he also participated in this practice.
“The way they systematically raised slush funds was what I did for a long time,” Ouchi told The Japan Times. “This confirms my belief that the fraudulent practice is widespread and directed by the NPA.”
While working as an accounting clerk at police stations in Tokyo between 1982 and 2000, Ouchi visited MPD headquarters in Chiyoda Ward at the beginning of each month to pick up informant-reward money, which was kept in separate brown envelopes for each section at the station.
The misappropriation starts at this point, Ouchi said. While posted to the Kitazawa Police Station in Setagaya Ward between 1989 and 1990, he said he took a portion of cash from each envelope, say 20,000 yen out of 100,000 yen. He said he skimmed an average of 200,000 yen each month in line with a rule handed down from his predecessors.
Ouchi said he then divided the skimmed funds into other envelopes and handed them to the station chief, who pocketed his cut and passed the rest on to other senior officials. The station head got 50,000 yen, deputy head 30,000 yen and each division chief 10,000 yen, he said.
Harada has testified that he pocketed 50,000 yen during his stint at the Asahikawa station and mainly spent the money for social expenses in line with his position, such as wining and dining visiting government officials.
After removing “allowances” for senior officers, Ouchi said he handed the remaining money in the envelopes to each section chief.
“More conscientious” chiefs handed all the money to their subordinates, but in the “worst” cases, according to Ouchi, they simply pocketed the entire take. In any event, none of the money was paid as informant rewards, as stated in accounting records, he said.
Accounting clerks in each division, like Ouchi, then faked accounting records with receipts from nonexistent informants, using names pulled from telephone directories and hundreds of ready-made seals sold at stationery shops, he said.
According to testimony by two former Hokkaido police officials, the accounting sections of local-level stations in the prefecture, which are smaller than their Tokyo counterparts, receive the investigative reward sum and transfer it to a secret coffer managed by deputy heads to allow station chiefs to use the money at their discretion.
To make the bogus receipts look authentic, accounting clerks make all investigators write down the names of bogus informants on their receipts — a practice that makes all officers accomplices and thus discourages them from going public about the fraud, Ouchi said.
The leaked Asahikawa internal documents included accounting reports and receipts that suggested that a combined 510,000 yen was rewarded to 36 “informants.” A majority of the listed people are fictitious, and at least 10 of those who do exist told local media that they neither cooperated with police nor received any cash.
The two Hokkaido officials and Ouchi said that the prefectural force headquarters, which took a large portion of the informant money before allocating the rest to branch stations, raised slush funds similarly by using investigative rewards and other budget outlays.
They also testified that they either engaged in or witnessed the misuse of travel expenses — another primary source of secret funds, according to Ouchi — while they were stationed at prefectural police headquarters.
Earlier this month, Shizuoka Prefectural Police acknowledged that it embezzled 10.4 million yen from prefectural coffers in fiscal 1995 by falsely reporting that the money had been used for business trips and meals. Whistle-blowers said the NPA is deeply involved in these practices.
Harada has testified about the presence of slush funds at the NPA that are not budgeted as investigative reward money. He said he regularly received unauthorized “allowances” during his temporarily stint at the agency in the mid-1970s.
Saito of the Teshikaga force said NPA officials check the bogus accounting papers and receipts created by local police during in-house auditing and make them rewrite the documents if they are deemed likely to fail the annual board of audit inspection.
Ouchi said he was told by his bosses that prefectural force section chiefs must bring portions of the slush funds they created to related sections in the NPA. He said he has seen his bosses periodically take cash-filled bags to the NPA, which is located next to the MPD headquarters, while he was serving there.
In the written response to questions from The Japan Times, the NPA denied involvement in such misdeeds and said it has never directed or helped local-level police raise slush funds or skimmed portions of such money from them.
“The agency has strictly instructed each prefectural police force to execute their budget properly and keep proper accounting records,” the NPA stated.