The Kansai Electric Power Co. scandal over massive gifts from a former official of a town hosting one of its nuclear plants widened Friday as some of the recipients at the utility were found to be members involved in non-nuclear work.

Three former senior officials of a power transmission and distribution operation in Osaka received gift coupons worth 2.5 million yen ($23,400) from the former Takahama deputy mayor, Eiji Moriyama, who died in March at age 90, according to sources familiar with the matter.

The officials, including Managing Executive Officer Takashi Fukuda, met with Moriyama and told him of the size and estimated value of three projects, including solar power generation and distribution improvement projects in Takahama and Oi, both in Fukui Prefecture.

A construction company with close ties to Moriyama subsequently received the order for one of the solar projects through a prime contractor, according to the sources.

A probe report by Kansai Electric showed the utility company had given to Moriyama information regarding over 70 percent of the 113 orders won by the construction firm linked to him, Yoshida Kaihatsu.

Information about 83 projects related to the nuclear power business was provided from September 2014 to December 2017, according to the report on the scandal involving 20 Kansai Electric officials receiving large sums of money and gifts from him.

(Shigeki Iwane attends a press conference in Osaka, western Japan, on Sept. 27, 2019.)

The utility, which operates the nuclear complex in Takahama, has disclosed the officials had been given about 320 million yen worth of gifts since 2006 by Moriyama, who also served as an adviser to a Kansai Electric subsidiary for more than 30 years.

The company had not kept records of the money and gifts received.

Industry minister Isshu Sugawara said at a press conference that other electric power and utility-related companies have conducted in-house probes to determine whether similar cases had occurred. Nine of the 12 companies which did the probes said they have found no such cases.

The remaining three, whose names Sugawara refrained from disclosing, are still conducting investigations.

"Utility firms are receiving electricity fees from people and they are similar to a tax," Sugawara said, adding the Economy, Trade and Industry Ministry demanded such companies ensured compliance.

At Kansai Electric's Kyoto branch, according to the report, Yoshida Kaihatsu had directly received orders for eight projects without tendering a bid during the same period.

Tax authorities have found, meanwhile, that from fiscal 2013 to 2018, orders placed by Osaka-based Kansai Electric with Yoshida Kaihatsu totaled some 6.47 billion yen, and that the construction firm paid around 300 million yen in commission to Moriyama.

The utility's nuclear power division placed 22 orders directly with Yoshida Kaihatsu from September 2014 to December 2017, and provided information on about 16 of them, the report said.

(Eiji Moriyama)
[Photo courtesy of Takahama town]

In addition, Moriyama received information on 67 of the 91 projects placed with Yoshida Kaihatsu through prime contractors, it said.

When Moriyama asked to meet officials of Kansai Electric, the company confirmed whether there was information to be provided, the report said, adding that the information given to him included the size and cost of projects.

The utility "was not aware that Mr. Moriyama was bringing money and goods in return for information," the report said.

From 2016 to 2017, Yoshida Kaihatsu gave 1 million yen in cash and 400,000 yen in gift certificates to Shigeki Otsuka, who was then a senior official of the utility's nuclear power division. Otsuka has returned the money and gift certificates, the company said.

Kansai Electric said Friday that Chairman Makoto Yagi and President Shigeki Iwane will resign or have resigned from the posts of outside directors at other companies such as Nippon Life Insurance Co. and department store operator H2O Retailing Corp.

The two executives have said they have no plan to step down from their current posts at Kansai Electric or business lobbies.

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