Economy, Trade and Industry Minister Shoichi Nakagawa said Friday two more cases of public fund misuse involving its officials have been confirmed and he will thus cut his own salary for another month in August.
The fresh cases follow an alleged case of misuse last month in which a ministry official used funds for personal stock trading.
One case involves a former head of the Budget and Accounts Division at the minister’s secretariat who bought a 2 million yen restaurant membership in 1975 by using money allocated by UNICEF for aid purchases in Japan, the minister said.
The other involves improper management of wages for part-time workers and unregistered substitutes brought in for them at the Americas Division between 1995 and last month.
The division used wages for the part-timers to pay the unregistered substitutes, who were being used to cover their sudden absences, he said. But their pay scales were different, and the ministry pocketed the difference.
“We have been keeping money which we should not have kept. I feel really sorry for causing public distrust and will work to regain people’s confidence in the ministry,” Nakagawa said.
The minister also said he will consider punishments after thoroughly conducting in-house investigations and consultations with law enforcement authorities.
The case involving the U.N. Children’s Fund is rooted in the ministry’s management of aid material procurement funds for the U.N. agency. The practice began in 1961.
UNICEF began to entrust most of the aid material procurement work to the Tokyo office of the U.N. Development Program in 1970, instead of the ministry, and the withdrawal of expenses for UNICEF projects from the funds ended in 1974. But the ministry continued to keep the money in a bank account managed by the ministry’s Budget and Accounts Division, according to METI officials.
Because the money accrued interest, however, what started out as about 18 million yen in 1974 has grown to 52 million yen.
Nakagawa and Vice Economy, Trade and Industry Minister Hideji Sugiyama said METI should have returned the remaining money to the U.N. agency at that point.
The minister said METI will consult with UNICEF and return the money.
It is not known why the now-retired accounts division head bought the restaurant membership under his name in November 1975, but he returned the 2 million yen four months later, the officials said.
In the case involving the part-timers’ wages, the division received 1.39 million yen from the state between 1995 and 2002 to pay the part-timers, but actually used only 1.07 million yen of it to pay the unregistered substitutes until June.
The ministry kept the remaining 321,290 yen.
Nakagawa said such a practice could constitute violations of accounting laws and the ministry will return the 1.39 million yen plus interest to the state coffers by asking former workers at the Americas Division to pay it out of their own pockets.
The division needed a number of part-time workers around 1995 when auto trade friction broke out between Japan and the United States.
Most of the workers were university students who were in the habit of suddenly applying for absences, but ministry rules were rather rigid, and the division had to register the names of the workers two weeks in advance and could not change the registration, the officials said.
Nakagawa cut his July salary after the alleged misappropriation of 24 million yen in public funds by a senior ministry official for personal stock trading surfaced.
Taizo Nakatomi, former head of the policy planning office at the secretariat, allegedly invested the 24 million yen together with his personal funds in Kanebo Ltd. and other companies’ stock around April 2004, earning 2 million yen in profit. But he has since returned the money and resigned on June 6.
The money he used was part of leftover funds pooled between 1988 and 1993 and entrusted to the ministry by a research institute. The money was originally a subsidy from a bicycle racing trade group.
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