OSAKA – Former Moritomo Gakuen President Yasunori Kagoike was freed on bail Friday, about 10 months after he and his wife were arrested on suspicion of fraud, and challenged Prime Minister Shinzo Abe to “tell the truth fair and square” about the favoritism scandal surrounding a shady land purchase in Osaka.
The couple were freed after the Osaka District Court rejected a complaint by the Osaka District Public Prosecutor’s Office against its decision Wednesday to let Kagoike, 65, and his wife, Junko, 61, out on bail.
The couple entered the spotlight after Moritomo Gakuen bought a plot of state land at a steep discount in Osaka to build a nationalist elementary school at which Abe’s wife, Akie, was named honorary principal.
Moritomo Gakuen was found to have acquired the 8,770-sq.-meter plot of land in Toyonaka, Osaka Prefecture, for about ¥134 million ($1.22 million) instead of its appraised value of ¥956 million.
Akie Abe resigned from her post after the eye-popping deal was revealed.
Kagoike has claimed that, as an acquaintance of Akie, he received special treatment, including a significant financial donation, because of his relationship with her.
After those claims, the couple found themselves at the Osaka detention center after being arrested on July 31 on unrelated charges, including defrauding the central and local governments of ¥170 million in school subsidies.
At a news conference Friday evening, Kagoike said the detention was politically motivated and challenged Abe’s version of events.
“As a statesman, he should tell the truth fair and square,” he said.
Kagoike declined to discuss his case but called the charges against his wife, who began sobbing at one point in the news conference, “false accusations.”
While Kagoike is likely to admit that he did apply for local government subsidies, his wife plans to deny having knowledge of the details, according to sources close to the matter.
As for subsidies from the central government, the Kagoikes are expected to fight the fraud charges.
The court rejected the couple’s previous request for bail last November. A second request was filed earlier this month.
The couple’s lawyer said bail of ¥8 million was set for Kagoike and ¥7 million for Junko.
On Wednesday the Finance Ministry released over 900 pages of records it had attempted to discard that detailed exchanges between Moritomo Gakuen and the ministry.
According to the ministry, officials at the bureau in charge of managing state assets pushed for the documents to be disposed of because they contradicted the testimony by Nobuhisa Sagawa, who headed the bureau at the time.