Business / Corporate

Vice minister of internal affairs quits over leak of penalties to scandal-hit Japan Post

Kyodo, JIJI

The top bureaucrat at the internal affairs ministry resigned Friday after leaking information on administrative penalties to Japan Post Holdings Co., which is embroiled in an insurance sales scandal, the ministry said.

Vice Minister Shigeki Suzuki resigned after the ministry decided to suspend him for three months for leaking information about the penalty plan over the phone to a former colleague at Japan Post Holdings, the former state-owned postal and financial services group that was privatized in 2007. The government still owns 57 percent of the company.

The move is another example of the cozy relations between ministry officials and the Japan Post group, a key provider of amakudari jobs to retired bureaucrats. Amakudari means “descent from heaven.”

“The conduct constitutes an act that hurts trust and the neutrality of official duties,” Sanae Takaichi, minister of internal affairs and communications, said at a news conference Friday.

Takaichi added that she will voluntarily return three months of her salary over the leak. Vice Minister for Policy Coordination Buichiro Kuroda, 59, replaced Suzuki the same day, she said.

The ministry said Suzuki leaked the information to Japan Post Holdings Senior Executive Vice President Yasuo Suzuki, who was vice minister at the same ministry from 2009 to 2010.

The ministry had launched an internal probe after finding that Yasuo Suzuki knew about part of its discussions about how to punish the company. Two of the group’s subsidiaries submitted a report on the improper insurance sales this month.

Japan Post only said it is still in the process of confirming the facts.

On Wednesday, Japan Post Holdings said that an internal investigation uncovered more than 12,836 cases of suspected illegal or improper insurance sales at subsidiaries Japan Post Insurance Co. and Japan Post Co. over a five-year period through March.

The internal affairs ministry has said it was considering imposing an administrative penalty on Japan Post in light of the scandal.

The Financial Services Agency plans to order Japan Post Insurance Co. and Japan Post Co. to suspend part of their operations for three months over improper sales practices involving the former’s insurance products, sources said Saturday.

The FSA will also issue a business improvement order to the two companies and demand they clarify management responsibility over the irregularities, the sources said. It also plans to urge the parent company to shape up over its failure to properly control the subsidiaries, they said.

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