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Prosecutors searched former Your Party leader Yoshimi Watanabe’s office and other related locations in September in connection with a funding scandal that forced him to quit as head of the now-defunct opposition party, sources said.

The prosecutors, who searched the office in Utsunomiya, Tochigi Prefecture, plan to question Watanabe, 62, on suspicion of violating the Political Funds Control Law for not reporting a loan, the sources said Sunday.

A veteran politician who formed Your Party in August 2009, Watanabe resigned as chief in April due to massive unreported loans from a corporate executive. The six-term House of Representatives lawmaker lost his seat in Sunday’s snap general election.

Your Party’s in-house probe released results in April that showed Watanabe borrowed ¥90 million sometime around the 2010 House of Councilors election and repaid the funds to an unidentified person. The prosecutors, however, later traced the bank account from which the loan was made to an individual linked to Watanabe’s political group in Utsunomiya.

The amount was not listed in his group’s political funds report, an omission that prosecutors view as a violation of the law. A person managing Watanabe’s group has said there was no need to include it down in the report because the bank account in question is managed separately from the assets of the group.

Your Party’s investigation found he borrowed ¥50 million in March 2010 and ¥40 million three months later from the account.

In July 2010, he repaid the money in full from some ¥300 million he borrowed from Yoshiaki Yoshida, chairman of cosmetics firm DHC Corp.

When Watanabe quit as Your Party leader he was under heavy fire for receiving two separate loans totaling ¥800 million from Yoshida in recent years. He denied the act was illegal, saying it was a personal loan and the money was not used for election or political funds.

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