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Japan Political Pulse: What I'd like to ask Dentsu over Olympic payment scandal

Following the emergence of suspicions over payments relating to the Tokyo 2020 Olympic bid, the point that interests me most is the role of major advertising agency Dentsu Inc.

    Dentsu is the biggest advertising agency in Japan in terms of sales, and on a global scale it comes in at No. 5. The company has international connections and know-how that make it possible to host major sporting events such as the Olympics and soccer World Cup, and is unsurpassed in this area.

    The advertising company, in other words, does not play a mere supporting role in bid activities, but is an immovable, main player. I would like Dentsu to provide its own explanation of the suspicions over payments so that the image of the Tokyo Olympics is not damaged any further.

    French prosecutors launched an investigation and a report appeared in the British newspaper The Guardian on May 11. The suspicious go as follows:

    -- Three years ago, around the time Tokyo was chosen to host the 2020 Olympic Games, the Tokyo bid committee made two payments totaling 230 million yen to an account linked to the son of the former head of the International Association of Athletics Federations (IAAF).

    -- The Senegalese former IAAF chief was at the time an influential member of the International Olympic Committee (IOC). He also had influence among IOC members representing African countries and had the power to sway the decision on where the Olympic Games would be held.

    -- The account was under the name of a company in Singapore, and the head of the company was a consultant to Athlete Management and Services (AMS), a Dentsu Sport subsidiary based in Lucerne, Switzerland.

    When questioned by the Mainichi, Dentsu said that AMS was not a subsidiary, and that it did not have a stake in AMS.

    But that's not the end of my story. There is an interesting anecdote regarding another subsidiary of Dentsu. In 1982, Dentsu launched a joint venture named ISL in the Swiss city of Lucerne with a company under the wing of German sporting goods giant Adidas. ISL's task was to secure the marketing rights for events such as the Olympics, the World Cup and the world athletics championships. The company engaged in maneuvers that were not illegal under local Swiss law, though there was a possibility they may have infringed on Japanese law.

    In 1995, Dentsu sold its shares in ISL and pulled out of the venture. On that occasion, 800 million yen, which was part of its gain on the sale, was returned to ISL. That money was used in activities to help win the bid to host the 2002 World Cup at a crucial stage of the bidding process. Japan and South Korea in 2002 eventually became the first Asian countries to host the World Cup. Toward the end of the race, South Korea had held the upper hand, but in the end the event was divided between both countries.

    Later, Japan's National Tax Agency searched Dentsu, suspecting hidden assets in Switzerland, but the agency wavered when it came to evaluating "lobbying activities" and the company was thus overlooked.

    The foregoing can be found in the book "Dentsu to FIFA" (Dentsu and FIFA) by nonfiction author Kenta Tazaki, based on an interview with a former senior managing director of Dentsu. The work was published in February this year by Kobunsha Shinsho.

    This former senior managing director, by the way, takes his place among directors of the Tokyo Organising Committee of the Olympic and Paralympic Games.

    Commercialization of the Olympics began with the 1984 Los Angeles Games. Massive amounts of money for broadcasting rights and sponsorship flowed into the International Olympic Committee, producing a breeding ground for corruption.

    French prosecutors are said to have become aware of the money sent from Tokyo while probing an account linked to the former IAAF chief in connection with allegations of an attempt to obtain money from the Russian athletics federation in exchange for concealing doping.

    Tokyo is not the only Olympic host city to have made large payments to consultants. What were those funds used for? Public officials on center stage don't know. A limited number of people in Dentsu know the answer to this.

    Does one take advantage of the custom of corruption without getting one's hands dirty? Can one get by persisting in denying all knowledge? These are questions I would like to ask Dentsu. (By Takao Yamada, Special Senior Writer)

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