In a possible violation of the Political Funds Control Law, the private political office of arrested lawmaker Tsukasa Akimoto may have diverted money from a Tokyo-based consultancy to pay the salaries of his private secretaries, investigative sources said Sunday.
Under such an arrangement, secretaries’ salaries need to be booked as “donations” from supporters. But Akimoto’s political funds reports between 2016 and 2018 had no mention of such money, which could amount to a violation of the law, the sources said.
The consultancy was founded in 2011 by one of Akimoto’s former secretaries. The lawmaker himself served as an adviser at one point while his wife also served as an auditor, the sources said.
Tokyo prosecutors are focusing on the three years to 2018 to uncover dubious flows of money involving Akimoto and cement his bribery charges, the sources said. He is suspected of taking bribes from a Chinese company wishing to break into the casino business in Japan.
Sources said earlier the Chinese company may have approached him in a bid to turn itself around through casino operations in Japan. Shenzhen-based online sports lottery provider 500.com saw its sales tumble after peaking in 2014, a private credit research agency and sources familiar with the situation said Saturday.
The company, founded in 2001, logged record sales of ¥9.4 billion in 2014, a year after it went public on the New York Stock Exchange. But sales plunged to ¥1.6 billion in 2015 and to ¥170 million in 2016, leaving an operating loss of ¥5.8 billion.
500.com set up a Japanese unit in July 2017. It organized a casino-related symposium in Naha, Okinawa Prefecture, in August the same year to increase its name recognition. Akimoto was asked to give a keynote speech at the event.
The company initially planned to pay Akimoto ¥500,000 for the speech. But it raised the amount to ¥2 million after learning, three days after the speech, that Akimoto would became state minister in charge of a government plan to introduce casinos in Japan.
When the Lower House was dissolved for a snap election on Sept. 28, 2017, 500.com gave ¥3 million in cash to Akimoto as a financial contribution to his election campaign.
Public prosecutors allege the financial contribution was a bribe aimed at receiving preferential treatment from Akimoto for its attempt to launch a casino resort in Japan, the sources said.
Akimoto’s ties with 500.com further deepened in December that year when the lawmaker — who had been appointed state minister in charge of integrated resorts — made a three-day visit to China that included the company’s headquarters in Shenzhen, sources familiar with the matter said.
During the visit, 500.com executives “conveyed their wish to be allowed to enter the Japanese casino market after related bills clear the Diet,” the sources said.
Then the executives tried to make a good impression on Akimoto by emphasizing that 500.com was working hard to mitigate the negative impact of gambling on people and society, without elaborating, the sources said. The executives also told Akimoto that 500.com could bring its huge customer base in China to Japan if it was allowed to enter the market, according to the sources.
Akimoto acknowledged the need to “bring foreign visitors to Japan under its inbound tourism policy and encourage them to spend their money” in Japan, the sources quoted him as telling the executives. Then he asked them to “work hard” to achieve their goal, the sources said.
Prosecutors suspect the entire trip may have been a case of wining and dining arranged by 500.com. They are also investigating whether Akimoto’s side used his Cabinet post to make unlawful demands to the company in return for favors.
As for the China trip, Akimoto himself explained it as an “inspection” of casino operations in China. In addition to the visit to Shenzhen, Akimoto also inspected a casino in nearby Macao during the three-day trip.
On Wednesday, prosecutors arrested three people related to 500.com for allegedly bribing Akimoto.
The charges against them also include inviting Akimoto and his family to Hokkaido in February 2018 and shouldering their travel expenses.
The company showed its intention to invest in a Sapporo-based tourism company that was planning to open a casino.
Akimoto was also arrested in the bribery case. He has denied the allegations.