Former Takefuji Corp. Chairman Yasuo Takei was sentenced Wednesday to a suspended three-year prison term for wiretapping and defamation of character.

The Tokyo District Court also fined Takefuji 1 million yen for violating the Telecommunications Business Law in the wiretapping.

Takei, the 74-year-old founder of the moneylender, pleaded guilty to ordering a subordinate in 2000 and 2001 to bug the phones of two freelance journalists who had written articles criticizing the major consumer loan firm.

He had also been charged with defamation of character for directing Takefuji employees to place libelous statements about one of the journalists on its Web site.

Takei's prison term was suspended for four years. Prosecutors had demanded he spend three years in prison.

In handing down the sentence, presiding Judge Tsutomu Aoyagi said there was no excuse for Takei's ordering the illegal wiretaps.

"As founder of Takefuji, his intentions to protect his company may have been sincere," the judge said. "But as leader of a major company, he should have considered legitimate actions, such as filing a lawsuit" to try to stop the publication of articles critical of the firm.

The judge also said the defamation of the journalist has had serious consequences, given that the statements were posted on Takefuji's Web site, which is accessed by a large number of people.

The wiretapping was discovered when former Takefuji employee Kazuhiro Nakagawa gave journalist Shunsuke Yamaoka internal company documents in 2002. From the files, Yamaoka wrote articles on problems in the company, including the practice of bugging phones.

According to Yamaoka, the documents included transcripts of private phone conversations between December 2000 and February 2001. Nakagawa also confessed to him that he had been involved in the wiretapping.

Nakagawa was given a suspended three-year prison term in May by the Tokyo District Court.

Takei was arrested in December on the wiretapping charge, and stepped down as chairman six days later.

The defamation charge came from a criminal complaint filed by Yamaoka and freelance journalist Yu Terasawa two months earlier.

Takei had ordered employees to write messages for its Web site, saying that allegations of wiretapping, which had appeared in articles written by the two journalists, were groundless and that they may have been relying on fabricated evidence.

In handing down the suspended sentence, Aoyagi said Takei quit as Takefuji chairman and is repentant. Takefuji released a statement that it accepts the court decision and will devote itself to preventing similar wrongdoings and to regaining public trust.

But Yamaoka told reporters, "I am dissatisfied with the ruling."

He said he does not think Takei is sorry for the wiretapping and claimed Takei, while out on bail during the trial, approached him and tried to settle the defamation charge out of court -- an action Yamaoka believes indicates he was trying to hush up the crime.

Separately, Kenji Utsunomiya, a lawyer active in helping heavy debtors of consumer loan companies, stressed that there are many unresolved problems at Takefuji.

Although Takei stepped down, his second son is still the representative director of Takefuji, and the company is suing several lawyers who are helping heavy debtors in an attempt to interfere with their work, he said.

As for Takei's relationship with Takefuji, the company has announced the founding family's share of the firm's outstanding stocks, which earlier stood around 60 percent, will eventually come down to less than 25 percent.