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Japanese Official Commits Suicide

March 12, 1998

TOKYO (AP) _ A Finance Ministry official hanged himself Thursday, the fourth Japanese official to commit suicide in a widening investigation of corruption in high places. The death came a day after dozens of prosecutors raided Japan’s central bank, seeking information in the probe.

Yoshio Sugiyama, 46, a deputy chief in the ministry’s powerful banking bureau, killed himself in his Tokyo apartment, said Naoto Fujii, a spokesman for the Tokyo Metropolitan Police.

His death is the latest shock in an investigation centering on the chronic collusion between bureaucrats and the businesses they regulate. The investigation has touched several aspects of government, including the previously untainted Japanese central bank.

Faith in the ``bank of banks,″ as the Bank of Japan is known among Japanese, was severely shaken by Wednesday’s arrest of Yasuyuki Yoshizawa, 42, chief of the bank’s capital markets division.

The same day, Tokyo prosecutor raided the bank to confiscate thousands of documents. TV news footage of at least 40 prosecutors filing into the bank, methodically lugging out enough boxes of files and floppy disks to fill a waiting van, stunned even seasoned Japan observers.

``There has been a serious blow to Japanese credibility,″ said Ken Okamura, a strategist at Dresdner Kleinwort Benson in Tokyo. ``It certainly shows that the scandal has spread much further than originally thought.″

It also pushed down Tokyo stock prices and sent the U.S. dollar soaring against the yen, reflecting fears the scandal will further hobble Japan’s stagnant economy and possibly hinder plans to ease financial regulations.

Yasuo Matsushita, the head of the bank, offered to resign to take responsibility for the events leading to the arrest of Yoshizawa, who was suspected of accepting lavish entertainment in return for leaking sensitive information to two private banks.

The Bank of Japan has never before been under a criminal investigation, and no central bank governor has ever resigned in disgrace over a scandal.

Prime Minister Ryutaro Hashimoto said Matsushita told him he would resign in a telephone conversation late Wednesday. ``I take his intention very seriously, although I told him that for now, I want him to do his best to fulfill his duties in his post,″ Hashimoto told reporters.

Matsushita apologized at a Parliament committee meeting Thursday.

``I plan to deal with this strictly, not only the official arrested but others involved,″ he said at the nationally televised session.

Although Matsushita is not directly implicated in the scandal, it is common in Japan for the heads of institutions to resign in an apologetic gesture.

``His resignation is inevitable,″ said an editorial in the Asahi newspaper. ``The trust many people held about the Bank of Japan has crumbled and faded.″

It was unclear exactly why Sugiyama killed himself. National broadcaster NHK said family members found a suicide note when they discovered Sugiyama’s body but the contents were not revealed. However, Japan has a long tradition of suicide as an answer to failure.

According to NHK, Sugiyama had worked in 1991 as an inspector alongside two ministry officials arrested in January on suspicion of accepting entertainment worth at least $37,500 from banks in exchange for tips about ``surprise″ inspections.

Prosecutors had questioned Sugiyama in February about the two arrested men, but they didn’t view him as a prime suspect in the bribery case, NHK said.

He is the fourth official to commit suicide in a probe that began when prosecutors came across a treasure trove of documents while investigating Ryuichi Koike, a reputed racketeer.

Koike is accused of organizing groups that buy token amounts of a company’s stocks and then threaten to disrupt the meetings with embarrassing allegations and violent behavior unless they are paid off.

Japan’s news media have speculated that two of the previous suicides may have been desperate attempts to prevent the scandal from tainting other colleagues.

The head of Japan’s highway authority killed himself in January as prosecutors investigated his agency after arresting a subordinate for allegedly accepting bribes from Nomura Securities Co. Days later, a ministry official hanged himself just as he was about to be questioned about receiving lavish entertainment from banks.

Last month, a governing party lawmaker hanged himself as prosecutors prepared a warrant for his arrest. He was accused of accepting dubious stock profits from another brokerage, Nikko Securities Co.

The scandal also has forced the resignation of a finance minister and the ministry’s top career bureaucrat.