Two ruling party lawmakers who received political funds from scandal-tainted Nishimatsu Construction Co. denied any wrongdoing Friday but said they have decided to return the money for ethical reasons.

Prosecutors have begun examining contributions Nishimatsu made to a Liberal Democratic Party faction headed by Economy, Trade and Industry Minister Toshihiro Nikai, it was revealed Friday.

“There is absolutely no reason for a special investigation,” Nikai told reporters Friday, denying he had engaged in any illegal activity.

Nikai has admitted that the political groups headed by ex-Nishimatsu officials bought about ¥8.4 million worth of his faction’s party tickets. It is normal for lawmakers to sell party tickets as a way of raising funds.

Although Nikai denied any illegality concerning the money, he revealed that he and his faction decided to return the full amount “from an ethical viewpoint.”

“There is nothing at all illegal” about the party tickets, Nikai said. “Some experts say that there is no need to return the money, but it concerns (the people’s) trust in politics so we have decided it would be better to give it back for moral reasons.”

Chief Cabinet Secretary Takeo Kawamura fully backed Nikai at a news conference Friday morning.

Nikai told Kawamura “there was absolutely nothing to worry about,” the government’s top spokesman said. “He said not to worry and I believe him.”

Shunichi Yamaguchi, a special adviser to Prime Minister Taro Aso on regional revitalization, also received ¥2 million from one of the Nishimatsu-related groups in 2004. While also denying any wrongdoing, Yamaguchi said he too decided to return the money from “a moral standpoint.”

“To put it in simple terms, it is unpleasant,” Yamaguchi told reporters Friday. “I feel like I’ve been dragged into something fishy.”

However, he admitted that he does not yet know how to return the money or to whom, since both political organizations have been disbanded.

Earlier this week, Takanori Okubo, chief secretary to Democratic Party of Japan head Ichiro Ozawa, was arrested on allegations for violating the Political Funds Control Law.

Okubo was also chief accountant of Ozawa’s political funds management body, Rikuzankai, which allegedly accepted ¥21 million from the two political groups in question despite knowing that the money was actually being funneled through them by Nishimatsu.

Ozawa flatly denied the prosecutors’ allegations and declared his intention to remain as president of the DPJ.

According to the Political Funds Control Law, a company cannot give donations directly to lawmakers but it can make contributions to political parties.

The two political groups headed by former Nishimatsu officials have made donations to various heavyweights in both the ruling and opposition parties, including former Prime Minister Yoshiro Mori, former Finance Minister Koji Omi and DPJ Diet affairs chief Kenji Yamaoka.

Cabinet slams Ozawa

Kyodo News

Members of Prime Minister Taro Aso’s Cabinet on Friday denounced opposition leader Ichiro Ozawa for accusing prosecutors of abusing state authority in arresting his top secretary.

“It is not possible for the state to abuse its power in an investigation,” Chief Cabinet Secretary Takeo Kawamura claimed, rebutting Ozawa’s allegation that the arrest earlier this week of Takanori Okubo on suspicion of taking illegal donations from political organizations related to Nishimatsu Construction Co. was politically motivated.

Justice Minister Eisuke Mori concurred. “I doubt there is a crucial correlation between (the arrest) and the political situation or the timing for a general election,” Mori said.

A Lower House general election must be held by fall.

Seiko Noda, state minister in charge of consumer affairs, chastised Ozawa by referring to a much-publicized Democratic Party of Japan campaign slogan.

The DPJ, Noda said, often claims it “pursues ‘clean politics,’ but if the allegation turns out to be true, then it’s in the same boat as the Liberal Democratic Party, which has often been criticized as corrupt.

“I hope President Ozawa continues to assume his responsibility to explain (what actually happened).”

Given that the scandal could possibly affect some LDP lawmakers who have received donations from Nishimatsu, many of Aso’s Cabinet ministers, however, appeared hesitant to become overly aggressive in their attacks on Ozawa and the DPJ.

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