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Politicians Questioned in Financial Scandal

May 17, 1989

TOKYO (AP) _ Prosecutors on Wednesday interrogated two politicians suspected of taking bribes in an influence-peddling scandal that has shaken public trust in Japanese politics.

They were the first elected officials questioned in the Recruit scandal, in which 14 bureaucrats and businessmen were arrested on charges of bribery or securities law violations.

Prosecutors said Takao Fujinami, chief Cabinet secretary under former former Prime Minister Yasuhiro Nakasone, and Katsuya Ikeda, a legislator from the opposition Komeito Party, each were questioned for about 12 hours.

The two are suspected of accepting bribes in return for helping the Recruit Co. in its employment information business.

Under Japanese legal custom, summonses for interrogation are regarded as an equivalent to arrest.

Ikeda, 51, said Tuesday that he would resign his Parliament seat. Ruling party officials denied reports that Fujinami, 56, would resign, but indicated he might have to do so if he is formally charged.

Also on Wednesday, Komeito chairman Junya Yano became the third party leader to step down in the scandal. He follows Prime Minister Noboru Takeshita, who is resigning as head of the ruling Liberal Democratic Party - and thus as prime minister - and Saburo Tsukamoto, who stepped down in February as head of the opposition Democratic Socialist Party.

Ruling party leaders still are trying to find a new prime minister who is untainted by the scandal.

″People hope that the prosecutors will go to the center of Nakasone administration,″ said Tsuruo Yamaguchi, secretary-general of the Japan Socialist Party.

News reports Tuesday said Nakasone would be willing to testify in Parliament concerning his links to Recruit. His refusal to testify in past months contributed to an opposition boycott of parliamentary business.

Aides to Nakasone were among some 160 politicians, bureaucrats and businessmen who bought bargain-priced unlisted shares in a Recruit subsidiary and made large profits when the price soared after public trading began.

Of 17 politicians linked to purchases of Recruit shares, 11 were members of the Cabinet of Nakasone, who was prime minister at the time of the share transactions.

A share transaction handled by Fujinami’s secretary brought profits of about $191,000, prosecutors said. Ikeda’s brother, Yuzuru, earned about $73,530 on Recruit share transactions, and news reports say 70 percent of that went into Ikeda’s own bank account.

Ikeda repeatedly raised questions in Parliament that prosecutors say were helpful to Recruit.

Komeito leaders held an emergency meeting and Chairman Yano later told reporters that he believed Ikeda’s statement that he was innocent of wrongdoing. But the Komeito chairman said public trust in the party had been impaired and said he had resigned.

Yano himself is under fire for links to an earlier scandal involving transactions.

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