Firm of Japanese lawmaker sister received dubious payoffs

Firm of Japanese lawmaker sister received dubious payoffs

JAPAN - A company run by one of the sisters of Takeshi Tokuda, a lawmaker who has left the Liberal Democratic Party over an alleged election fraud, received dubious payoffs from an affiliated firm of the Tokushukai hospital group, The Yomiuri Shimbun has learned.

The payoffs included a monthly outsourcing fee of ¥2 million (S$25,000) and a luxurious condominium unit at a greatly reduced price. An audit company for the affiliated firm has pointed out such dealings are problematic.

The case has revealed a fraction of the picture of companies' appropriation related to the Tokushukai hospital group virtually run by Tokuda, 42, a House of Representatives member, and his family. The group serves as Tokuda's power base.

The company in question is GP Holdings in Minato Ward, Tokyo. Michiyo Stern, 46, Tokuda's sister, is a shareholder and the president of the company, which was founded in 2004 for management consulting and other purposes. Stern is one of six people arrested Tuesday on suspicion of conspiring to provide monetary benefits to Tokuda's campaign staff for the 2012 lower house election.

The affiliated firm is Kabushikigaisha Tokushukai in Chiyoda Ward, Tokyo, which distributes syringes and other medical supplies to hospitals within the Tokushukai group.

According to a report released in July 2011 by the audit company for the affiliated firm, GP Holdings made an outsourcing contract with the firm for information gathering in June 2010 and received a monthly fee of ¥2 million for more than a year. But the audit company raised suspicions that the contract had no substance because there was no document to confirm the agreement.

GP also purchased a condominium unit in Minato Ward from the affiliated firm for ¥140 million in August 2010, although the unit of about 162 square meters had been bought by the firm four months earlier for ¥200 million. The audit company has said the difference of the purchase prices- ¥60 million-is regarded as a donation from the affiliated firm to GP.

Stern uses the condominium unit as her home, and it has been searched by the Tokyo District Public Prosecutors Office's special investigation squad in relation to the election scandal.

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