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Prosecutors won't charge Sagawa, Finance Ministry officials over Moritomo scandal

Nobuhisa Sagawa (Mainichi)

OSAKA -- Special investigators with the District Public Prosecutors Office here announced on May 31 that they decided not to press criminal charges against former National Tax Agency chief Nobuhisa Sagawa and other Finance Ministry officials over the sale of state-owned land by the ministry to school operator Moritomo Gakuen.

The sale is at the center of a favoritism allegation against Prime Minister Shinzo Abe and his wife Akie, although the premier has repeatedly denied they used their influence to help Moritomo receive a massive discount when buying the land in Toyonaka, Osaka Prefecture.

Sagawa and the others were the target of criminal complaints over the falsification of public documents approved by the ministry or breach of trust complaints alleging that they sold the state land at an unjustifiably low price.

The prosecutors' decision came after the ministry announced in March that 14 documents approved by the ministry were later falsified under the direction of the Finance Bureau from February through April 2017. Original documents contained price negotiation records between the ministry's Kinki Local Finance Bureau and the Osaka-based Moritomo, and the names of Abe's wife and multiple politicians. Sagawa has told investigators that he was informed by subordinates that they were going to delete such information and he approved the action, according to people familiar with the case.

The doctoring of paperwork was carried out because Sagawa had told the Diet that the Kinki bureau "never negotiated with Moritomo over the price" of the land, contrary to information in the documents.

The prosecutors judged that they could not press criminal charges against Sagawa and other officials for the falsification of public documents because the law states that such an act is deemed illegal only when the perpetrator has the relevant authority and makes significant changes that alter the main character of a document.

The favoritism allegation over the land deal emerged in February last year. The sale was made at a price 800 million yen lower than the original quote, after Moritomo officials argued that waste was found buried at the site where they planned to build an elementary school.

A criminal complaint filed against Finance Ministry officials alleged that they offered the bargain sale out of consideration for the prime minister's wife who had been appointed honorary principal of the school, and to protect themselves.

But the special investigators apparently determined that the officials had no intention of causing damage to state coffers, and rather tried to evade trouble over the waste disposal and a potential damages suit from the school operator. Moritomo officials had told the ministry that they were poised to sue the state for damages if the opening of the school was delayed past their planned date, and the sales contract between the ministry and Moritomo contained a special provision barring the school operator from seeking damages from the ministry. These factors apparently reinforced the investigators' conclusion to not press charges.

Sagawa and the others also faced criminal complaints for their involvement in discarding the ministry's records of negotiations with Moritomo, but the special investigators did not pursue charges on this issue because some of the pre-doctored records still exist.

(Japanese original by Shiho Miyajima and Masayuki Takashima, Osaka City News Department)

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