The largest faction of the ruling Liberal Democratic Party is suspected of having misappropriated revenue from fundraising parties to support Upper House election campaigns for years, a source familiar with the matter said Saturday.

The faction had allegedly returned to lawmakers running for House of Councilors elections all revenue from sales of fundraising tickets they sold for the group without declaring the income in political funds reports, intending to use them as secret funds, according to the source.

Prosecutors are looking into the matter as possible violations of the political funds control law, which requires an accountant to submit a report on income and expenditures.