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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 seventimes 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 inother countries to 'make' corruption cases.

The Shipbuilding Scandal erupted in the economic bust period that followed the Korean War, whenJapan'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) wouldlater 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, theworst political crisis in Japan since the end of World War II. LDP leader Shin

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Kanemaru was among those forced to resign. One of Takeshitas top aides committed

suicide. Many thought he chose suicide to avoid revealing any wrongdoing about his

boss.

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 theshares 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

authorities.

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 theAct on Elimination and Prevention of

Involvement in Bid-Rigging,with the aim to eradicate officialcollusionin bid

rigging.

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

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