Tokyo prosecutors Thursday arrested trading house executive Motonobu Miyazaki, the man at the center of the scandal involving former Vice Defense Minister Takemasa Moriya, for allegedly embezzling more than ¥100 million.
The prosecutors suspect the 69-year-old former managing director of defense equipment trader Yamada Corp. engaged in unlawful accounting and conspired to misappropriate Yamada funds to found rival Nihon Mirise Corp., investigative sources said.
Also arrested was Tomonari Imaji, 57, who allegedly conspired with Miyazaki while serving as Yamada's former operating officer to forge business documents that favored Nihon Mirise.
The investigators plan to quiz Miyazaki about his alleged cozy ties with Moriya, who has admitted accepting paid golf outings from the executive more than 200 times while serving as the top defense bureaucrat, the sources said.
In sworn Diet testimony last month, Moriya also admitted that politicians, including a former Defense Agency chief, were with him during the wining and dining sessions sponsored by Miyazaki.
Moriya is suspected of performing favors for Yamada and Nihon Mirise regarding the procurement of jet engines made by General Electric Corp. of the U.S. Moriya denied this in the testimony.
Miyazaki is suspected of embezzling some ¥117 million last year from Yamada's Virginia-based U.S. subsidiary Yamada International Corp., part of which was used as funds to set up Nihon Mirise, the sources said.
Miyazaki allegedly issued the instruction to Osamu Akiyama, a former president of Yamada International, the sources said.
Also arrested was Tomonari Imaji, 57, who allegedly conspired with Miyazaki while serving as Yamada's former operating officer to forge business documents that favored Nihon Mirise.
The investigators plan to quiz Miyazaki about his alleged cozy ties with Moriya, who has admitted accepting paid golf outings from the executive more than 200 times while serving as the top defense bureaucrat, the sources said.
In sworn Diet testimony last month, Moriya also admitted that politicians, including a former Defense Agency chief, were with him during the wining and dining sessions sponsored by Miyazaki.
Moriya is suspected of performing favors for Yamada and Nihon Mirise regarding the procurement of jet engines made by General Electric Corp. of the U.S. Moriya denied this in the testimony.
Miyazaki is suspected of embezzling some ¥117 million last year from Yamada's Virginia-based U.S. subsidiary Yamada International Corp., part of which was used as funds to set up Nihon Mirise, the sources said.
Miyazaki allegedly issued the instruction to Osamu Akiyama, a former president of Yamada International, the sources said.
Prosecutors have obtained an arrest warrant for Akiyama, who is currently in the United States, and are asking him to return to Japan, they said. After Miyazaki set up Nihon Mirise, Akiyama joined as a board member.
The pair are suspected of cashing checks made out as remuneration for board members of Yamada International, transferring the money to a bank account of Akiyama, and depositing it into another account to raise a slush fund.
The sources said Yamada International had been providing slush funds since at least 10 years ago, and the cumulative amount may have reached several hundred million yen.
Miyazaki left Yamada in June 2006. Around that time, he allegedly arranged the transfer of ¥117 million from the subsidiary. As at least ¥30 million of that amount is unaccounted for, prosecutors suspect he might have used the money to set up Nihon Mirise in September 2006.
Miyazaki is also suspected of rewriting part of a sales representative agreement between Yamada and a U.S. agent in July 2006.
With the alleged rewriting, he is believed to have tried to sever business ties between Yamada and Avex Aerospace Corp., and form contracts between the California-based agent and Nihon Mirise.
Nihon Mirise said Monday that Miyazaki bowed out Nov. 1 for "personal reasons."
The pair are suspected of cashing checks made out as remuneration for board members of Yamada International, transferring the money to a bank account of Akiyama, and depositing it into another account to raise a slush fund.
The sources said Yamada International had been providing slush funds since at least 10 years ago, and the cumulative amount may have reached several hundred million yen.
Miyazaki left Yamada in June 2006. Around that time, he allegedly arranged the transfer of ¥117 million from the subsidiary. As at least ¥30 million of that amount is unaccounted for, prosecutors suspect he might have used the money to set up Nihon Mirise in September 2006.
Miyazaki is also suspected of rewriting part of a sales representative agreement between Yamada and a U.S. agent in July 2006.
With the alleged rewriting, he is believed to have tried to sever business ties between Yamada and Avex Aerospace Corp., and form contracts between the California-based agent and Nihon Mirise.
Nihon Mirise said Monday that Miyazaki bowed out Nov. 1 for "personal reasons."
