Scandal-hit faction of Japan's LDP 'suspected of misusing campaign funds'

Amid a burgeoning scandal, the largest faction of Japan's ruling Liberal Democratic Party (LDP) is suspected by prosecutors of misusing funds earmarked for political campaigns, local media reported on Saturday.

The largest LDP faction, previously led by late Prime Minister Shinzo Abe, is suspected of diverting revenue from fundraising events, specifically sales of fundraising tickets, to support upper house election campaigns for years, the national news agency Kyodo reported citing sources close to the matter.

The faction, which holds a significant presence within the LDP with over a quarter of its lawmakers, is believed to have systematically returned revenue from the sales of fundraising tickets to lawmakers participating in House of Councillors elections.

The income was reportedly not declared in required political funds reports, suggesting an intention to use them as secret funds, said the report.

The Abe faction, namely Seiwaken, or the Seiwa policy study group, is reportedly suspected of having pooled secret funds amounting to around 500 million yen (about $3.51 million) over the past five years.

On Friday, the Tokyo District Public Prosecutors Office's special investigation squad searched offices of two ruling Liberal Democratic Party factions, including Seiwaken, which was suspected of violating the Political Funds Control Law by failing to report kickbacks allegedly given to offices of lawmakers.

In the wake of the unfolding scandal where five major factions were suspected of paying kickbacks to member lawmakers who sold fundraising party tickets above their quota without recording the amount as revenue in its political fund reports, over 10 senior officials or heavyweight lawmakers have stepped down from their positions in the cabinet of Prime Minister Fumio Kishida or the LDP.

The scandal has pushed the support rate for Kishida's cabinet to a fresh low of 22.3 percent in the latest survey by Kyodo News, signaling that the administration may be in the "danger zone."

Read more:

Japan Cabinet Shake-Up: Four ministers resign over fund-raising scandal