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since 1948, Japanese prosecutors have indicted 41 members of parliament for bribery, 22 of which (more than

half) occurred during the period 1948-54. However, despite frequent prosecutor promises to 'clean the sewers' of
political corruption and strong public and media support for that goal, since the occupation ended in 1952 only
one member of Japan's political power elite has been charged with a serious offense--former Prime Minister
Tanaka Kakuei, for bribery in the 1976 Lockheed scandal, the biggest corruption scandal in postwar history.
This raises two major questions: first, given so much political corruption in postwar Japan, why has only one
major politician been indicted for a serious bribery offense? And, second, since prosecutors were nearly seven
times more active before 1954 than after, what happened after 1954?
Most conspicuously, compared to their American counterparts, Japanese prosecutors work in a 'schizophrenic'
legal environment. On the one hand, in 'ordinary' cases of street crime, Japan's rules of criminal procedure
confer so many advantages on prosecutors that they are able to dominate the criminal process and 'make' cases
far more easily than prosecutors in other countries. On the other hand, Japanese prosecutors lack many of the
procedural powers--like the authority to offer immunity or conduct undercover stings--that are routinely used in
other countries to 'make' corruption cases.

The Shipbuilding Scandal erupted in the economic bust period that followed the Korean War, when
Japan's struggling ship-transportation and shipbuilding companies bribed key government officials--
politicians and bureaucrats--to draft and pass legislation that would benefit their industries. The bribes
worked. In January 1953, the Diet passed the Law for the Subsidization of Interest and Insurance Against
Losses of Oceangoing Shipbuilding, thereby enabling the shipbuilding industries to borrow money at
below-market interest rates, and in August of the same year the law was revised to expand government
support even more.
However, that lobbying success became a scandal when prosecutors discovered a memo written by
Yokota Aizaburo, the president of the Yamashita Steamship Company, listing not just the names of more
than thirty well-known politicians and bureaucrats, but also the dates and dubious aims of Yokota's
meetings with them. The list of bribees included Transportation Minister Ishii Mitsujiro, Deputy Prime
Minister Ogata Taketora, Ikeda Hayato (then president of the Liberal Party's Policy Affairs Research
Council), and Liberal Party Secretary General Sato Eisaku. Ikeda (1960-64) and Sato (1964-72) would
later become prime ministers, and in 1974 Sato would go on to win the Nobel Peace Prize for his
antinuclear diplomacy.

During Lockheed Scandal, Prime Minister Kakuei Tanaka was forced to resign in 1974
as a result or corruption allegations. In 1976, he was arrested for taking bribes in the
scandal in which the aircraft maker Lockheed channeled funds to top officials in the
Japanese government in return for their help in a deal to sell L-1011 Tri-Star jets to All
Nippon Airways.
The Lockheed scandal broke in February 1976 when a Lockheed executive, A. Carl
Kotchian, testified before the U.S. Congress that Lockheed gave money to foreign
officials to selll Lockheed aircraft. The accusation led to the indictments of 16 Japanese
politicians, including Tanaka. Kodama Yoshio, one of the founders of the LDP, was
charged with accepting huge payments from Lockheed. Tanaka was convicted in a
lower court and died in 1993 while appealing his case to the Japanese Supreme Court.

Prime Minister Noboru Takeshita was forced out of office in April 1989 after members
of his party, the LDP, were implicated in the shares-for-favors Recruits scandal, the
worst political crisis in Japan since the end of World War II. LDP leader Shin
Kanemaru was among those forced to resign. One of Takeshita’s top aides committed
suicide. Many thought he chose suicide to avoid revealing any wrongdoing about his
In the Recruits scandal, LDP lawmakers accepted pre-flotation shares of Recruit
Cosmos Co., a real estate subsidiary of the Recruits group, with the understanding the
shares would soar in value when the they were listed on the Tokyo stock market. In
return the lawmakers granted Recruit favors which helped it expand its business.
Some 70 politicians and insiders purchased stock before the company was listed. When
it was listed people already holding stocks made a killing. After the deals became public
in 1988, 11 Diet members were investigated on bribery charges but not indicted. The
trial for the Recruit scandal lasted for 13 years and involved 322 hearings.

Positive developments in relation to corruption and investment:
 The government requires external auditors to report suspicious illegal activity to
 The police, prosecutors, and agencies such as the National Tax Agency (NTA), and
Financial Service Agency's Securities and Exchange Surveillance Commission are
collaborating more closely and sharing information related to bribery.
 Amendments were made in 2006 to the Act on Elimination and Prevention of
Involvement in Bid-Rigging, with the aim to eradicate official collusion in bid
Risks of corruption:
 Close ties between politicians, Japanese companies, universities, and government
organisations, institutionalises corruption and heavily influences biddings for
government contracts, among other things.
 Whistle-blowers within both the public and private sectors risk being demoted, fired,
and harassed, despite legislation protecting them from recrimination.
 Japan does not sufficiently enforce the OECD Anti-Bribery Convention, which they
are party to