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More senior Japanese bank officials charged in racketeering scandal

June 26, 1997

TOKYO (AP) _ Prosecutors filed formal charges Thursday against four current and former officials of Japan’s Dai-Ichi Kangyo Bank accused of giving 11.8 billion yen ($103,500) to a corporate extortionist.

The Tokyo District Prosecutors office also charged Ryuichi Koike with taking the money, disguised as loans backed with collateral, despite knowing that the payments were illegal.

The office said in a statement that between July 1994 and August 1996, the four bank officials made 51 separate payments through a credit union to an account that belonged to Koike’s brother, Yoshinori.

Bank officials knew Koike wouldn’t be able to pay back the loans, the prosecutors office said, since his existing loan balance already far exceeded the total value of his collateral.

The four Dai-Ichi Kangyo Bank officials are all former members of the bank’s administrative affairs department, believed to have been responsible for dealing with ``sokaiya″ extortionists, who specialize in threatening to disrupt shareholders’ meetings.

Of the four, Hiroshi Inotsume has resigned from the bank, while the other three _ Tatsuo Shibuya, Michiyoshi Kusajima and Takushi Manabe _ still work there.

Dai-Ichi Kangyo Bank is one of the world’s largest commercial banks in terms of assets and deposits. In consumer banking, it serves 39 million individual accounts.

Koike also is alleged to have received illegal payments from Nomura Securities. At least 14 senior executives of Nomura and Dai-Ichi Kangyo are under arrest, accused of funneling millions of dollars to Koike.

The scandal has highlighted the rampant racketeering against top Japanese companies, and their willingness to do illegal business with the extortionists rather than turn them in.

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