Prosecutors have questioned the person in charge of accounting for the Liberal Democratic Party’s largest faction, led by former Prime Minister Ryutaro Hashimoto, in connection with an undeclared donation the group received in 2001 from a scandal-tainted dentist association, sources said Thursday.

They said prosecutors might establish a criminal case over a possible violation of the Political Funds Control Law. The accountant, who was not identified, is suspected of deliberately concealing 100 million yen that Sadao Usuda, 73, then chairman of the Japan Dental Association, allegedly handed Hashimoto, they said.

Under the law, someone entering a fictitious account in an annual political funds report can face imprisonment of up to five years or a fine of up to 1 million yen.

Prosecutors might question Hashimoto on a voluntary basis in connection with the case, they said.

Usuda has been charged with bribery and has been served an arrest warrant for alleged embezzlement. He told prosecutors that he gave Hashimoto a check for 100 million yen in a Tokyo restaurant shortly before the July 2001 House of Councilors election. The money was meant as campaign funding for the election, investigative sources said earlier.

The 100 million yen had come from the coffers of the dental association’s political arm.

Hashimoto has claimed he does not remember accepting the check.

His faction, however, has confirmed it accepted the money as a donation and said it corrected its political funds report, which had failed to include the payment.

The check was later cashed and paid into the faction’s bank account, but the faction’s fund report for 2001 only lists a donation of 1 million yen from the dental association’s political body.

In 2001, the faction reported that it collected 420 million yen in political donations.

A political funds report released by the dental association’s political arm similarly fails to mention the 100 million yen payment it made to the Hashimoto faction.

An official of the body has said the organization repeatedly asked the faction’s secretariat for a receipt for 100 million yen payment, but received no response.

Prosecution investigators have also quoted Usuda as saying that two other senior members of the faction — Hiromu Nonaka and Mikio Aoki — were present at the meeting and confirmed the value of the check.

Nonaka, a former LDP secretary general, retired from the Diet last year. Aoki was recently promoted to chairman of the LDP’s Upper House caucus.

Hashimoto, prime minister from 1996 to 1998, is said to have strong ties with the dental association, which has around 50,000 members and an annual budget of 1.8 billion yen.

In 2001, the dental association was arranging to back its former chairman, So Nakahara, in the Upper House election. The 100 million yen donation is believed to have been paid to Hashimoto in exchange for his faction’s cooperation in Nakahara’s re-election bid, the sources said.

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