A political organization associated with the secretary general of Japan's ruling Liberal Democratic Party transferred a large amount of funds to another group subject to less stringent rules on the disclosure of usage, their balance sheets showed Wednesday.
The organization of House of Representatives lawmaker Toshimitsu Motegi, the No. 2 figure after Prime Minister Fumio Kishida in the LDP, has moved around 440 million yen ($3 million) to the recipient group for 14 years through 2022, according to the balance sheets.
The funds transfer has made it impossible to trace how more than 94 percent of them were used. Some pundits have criticized Motegi for apparently creating and utilizing a slush fund in violation of the political funds control law.
The revelation came during a period of intense scrutiny on the LDP, triggered by allegations that certain factions within the party failed to report portions of their incomes from fundraising parties and have been amassing undisclosed funds for years.
The funds control law mandates that political organizations associated with lawmakers declare all expenditures exceeding 10,000 yen, except staff salaries, in their income and expenditure reports.
But groups categorized as "other political organizations" only have to report expenditures of 50,000 yen or more, even if they are used for election campaigning activities, in a system that started in 2009.
The two groups involved in the money transfer have been registered at the same address and shared an accountant in common. Motegi has asserted that he handled his funds "appropriately" in compliance with the political funds control law.
So far, a total of 10 individuals belonging to three LDP factions, including one that Kishida headed until December, have been either indicted or issued summary indictments for violating the political funds control law.
The three factions within the LDP, including the largest one formerly led by the late Prime Minister Shinzo Abe, have decided to disband since the latest slush funds scandal was revealed late last year, rattling the ruling party.
No members of the Motegi faction have faced criminal charges. Motegi has expressed eagerness to maintain the faction as a "policy group," devoid of a mechanism to gather funds or the authority to recommend lawmakers to governmental and party positions.
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