Dispatch

The Yakuza Lobby

How Japan's murky underworld became the patron and power broker of the ruling party that intended to clean up politics.

TOKYO — Japan's leaders are going on trial this month -- in the court of public opinion, though some of them may be concerned about facing the more traditional kind.  

Prime Minister Yoshihiko Noda of the Democratic Party of Japan (DPJ), who has been in power for a bit over a year, dissolved Japan's parliament, the Diet on Nov. 16 after a series of scandals drove his poll numbers to an all-time low. The final straw was his appointment of mob-linked Justice Minister Keishu Tanaka, who resigned on Oct. 23 -- ostensibly for health reasons. A weekly magazine had reported on Oct. 11 that Tanaka had strong ties to the yakuza, Japan's organized crime groups -- which presumably isn't great for one's health.

The irony of the man in charge of the country's criminal justice system being friendly with organized crime was not lost on the Japanese public, especially at a time when there is a movement to crack down even harder on the yakuza. It was also an embarrassment to a political coalition that came to power in 2009 promising that it would bring "clean government." The rival Liberal Democratic Party (LDP), which had ruled Japan nearly uninterrupted for decades, had long been tied to Japan's underworld and ridden by scandals.

Since the DPJ came to power, organized crime ties have embarrassed several members of the party, including Tanaka. So how did the supposedly squeaky-clean reformers wind up in bed with Japan's answer to the Mafia? To understand this, it helps to look at the unique role the yakuza plays in Japanese politics.

The yakuza has its origins in federations of gamblers and street merchants of the Edo period (from the 17th to the 19th centuries), which evolved over time into the sprawling crime syndicates they are today. Currently, the yakuza comprises roughly 79,000 people, divided among 22 groups. Although referred to by authorities as "anti-social forces," it's actually a semilegal entity with offices, business cards, and fan magazines. The yakuza groups make their money through a combination of legal businesses -- like dispatching day laborers -- and illegal activities such as extortion, racketeering, and financial fraud. The largest yakuza group, the Kobe-based Yamaguchi-gumi, has 39,000 members. The Inagawa-kai, the group most closely tied to former Justice Minister Tanaka, has 10,000 members and is based in Tokyo. Its offices are across from the Ritz-Carlton.

The Inagawa-kai was established in 1948. The organization's de facto leader, Kazuo Uchibori, was arrested on charges of money laundering in October but was released without being charged. Uchibori is a blood brother to a powerful leader in the Yamaguchi-gumi, Teruaki Takeuchi, essentially putting the Inagawa-kai under the Yamaguchi-gumi umbrella. The yakuza world is constructed like a virtual family, in which ties of brotherhood, often solidified in sake-drinking rituals, are the grounds for allegiances within yakuza groups and sometimes with rival groups as well.

In 2007, two years before it came to power, the DPJ received the coveted endorsement of the Yamaguchi-gumi and the Inagawa-kai. It was a relationship that worked out well, until recently. However bizarre it may sound, there's nothing particularly remarkable about an organized crime group supporting a political party in Japan. Robert Whiting's book, Tokyo Underworld, recounts how Yoshio Kodama, a yakuza associate and racketeer, was instrumental in the formation of the LDP. In 1994, LDP Transportation Minister Shizuka Kamei was able to keep his job after having admitted to receiving roughly $6 million, paid into his bank account directly from a Yamaguchi-gumi boss. He claimed he received the money on behalf of his constituents who had lost money investing with a real estate agency that turned out to be a yakuza front company. He stated that he returned the money to his constituents. Crime or not, that should be grounds for political dismissal. Not in Japan. In 2009, the DPJ coalition appointed Kamei as minister of financial services, tasked with overseeing the Securities and Exchange Surveillance Commission and ensuring that Japan's financial markets stay clean.

But times have changed. The Japanese public is no longer so tolerant of politicians or companies with yakuza ties. In a 2007 white paper on crime, Japan's National Police Agency issued a warning that "the yakuza have made such incursions into the financial markets that they threaten the very basis of the Japanese economy." In that same year, a yakuza boss assassinated Nagasaki Mayor Iccho Ito after he attempted to cut the gangs out of public works projects. Japanese voters might have looked the other way at graft or low-level corruption, but political terrorism is another story. The yakuza had become an international embarrassment, as well. In 2011, U.S. President Barack Obama recognized them as a threat to the United States, issuing an executive order that led to the U.S. Treasury Department's passing economic sanctions against the Yamaguchi-gumi and two of its leaders this year. They have simply become too big a liability and embarrassment for the world's third-largest economy to ignore.

* * *

If you're a criminal, it always helps to have an ally in the Justice Ministry, and for some yakuza, Tanaka's appointment was seen as a match made in heaven -- especially for the head of the Inagawa-kai, Uchibori, who had been evading arrest on money-laundering charges since Aug. 22. Tanaka didn't have the power to stop the investigation of Uchibori, but his position could have enabled him to exert favorable influence. The Tokyo prosecutor's office is under the supervision of the Justice Ministry. Theoretically, Tanaka could have possibly recommended Japan's chief prosecutor to drop the Uchibori case; Uchibori was arrested on Oct. 9 but had not been formally charged for money laundering or other offenses while Tanaka was in power. Tanaka, for his part, initially claimed that he had only served as the "the matchmaker" at the wedding of an Inagawa-kai yakuza underboss and attended a yakuza party. A decade ago, that might have sufficed, but in today's political climate, he was forced to resign.

But the DPJ's problems didn't end with Tanaka. The weekly magazine Shukan Bunshun reported on Oct. 18 that Koriki Jojima, the newly appointed finance minister, was backed in his reelection bid by an Inagawa-kai front company. Jojima claims he didn't know whom he was dealing with.

According to LDP Sen. Shoji Nishida, who has written in depth about DPJ ties to organized crime, "Tanaka is the fourth DPJ cabinet member to have been shown to have yakuza ties. Japan has always had a vibrant underworld, and it's always had a normal society. The current ruling government is the underworld and overworld put together. I believe that they've been a conduit for the underworld in the political sphere. The problem has been very underreported here."

For those outside law enforcement or the mob, it's a bit surprising that the scandal is only breaking through now. The police first confirmed that the Yamaguchi-gumi and the Inagawa-kai had ordered their members to support the DPJ in the summer of 2007. According to reports in the daily newspaper Yukan Fuji, over 90 top bosses of the Yamaguchi-gumi were given orders to support the DPJ in upcoming elections. Many had been summoned to the organization's Kobe headquarters and been verbally instructed.

Top police officials said on background that they believe a senior DPJ official promised to keep criminal conspiracy laws off the books in exchange for votes and financial support from the crime group.

This makes sense. Japan does not have an equivalent of the U.S. RICO (Racketeer Influenced and Corrupt Organizations) Act, which was instrumental in helping U.S. authorities destroy the Italian-American Mafia in the 1970s and 1980s. Japan has most of the elements in place to create the equivalent of such an act and signed the U.N. Convention Against Transnational Organized Crime in December 2000 -- but so far the country has failed to fully implement it.

That's largely because the so-called "clean DPJ" has staunchly opposed legislation for a criminal conspiracy act, which would make it easier to prosecute yakuza bosses in criminal courts for the actions of their soldiers and seize their assets. According to the Sankei Shimbun newspaper, the DPJ refused to even discuss the legislation when it was a minority party in 2006.

In the meantime, Japan's law enforcement community has been taking matters into its own hands. In an almost covert rebellion, the National Police Agency (NPA) has quietly worked to circumvent the national government by getting local ordinances in place around the country criminalizing paying off the yakuza or doing business with them.

One can see why the yakuza would back the DPJ, but what were the politicians getting out of it? Well, the yakuza are quite well funded, for one thing. Robert Feldman, an economist for Morgan Stanley Japan, once called the Yamaguchi-gumi Japan's "largest private-equity group." Jeff Kingston at Temple University has speculated in his book Contemporary Japan that if the crime group were listed on the stock exchange, it would rival Toyota.

The yakuza, which specialize in extortion and blackmail in their own business dealings, are also useful in finding dirt on political opponents and squelching criticism of their benefactors. And as one-third of the yakuza are Korean-Japanese, they are also useful in securing the support of ethnic Korean groups in Japan and getting political funding from the lucrative Korean-dominated pachinko (arcade-style gambling games) industry. They are also able to mobilize local community leaders and associates to "get out the vote."

However, following the Nagasaki mayor's assassination, the growing influence of the "yakuza money" became a public concern. On Sept. 29, 2009, Takaharu Ando, the head of the NPA, ordered all police in Japan to focus on dismantling the ruling faction of the Yamaguchi-gumi, the Kodo-kai, stating, "The Yamaguchi-gumi Kodo-kai are threatening police officers, are increasingly uncooperative, and expanding their economic activities into all realms of society." It was the first time the NPA had specifically targeted a single faction of the Yamaguchi-gumi since the so-called "war on the yakuza" was officially launched back in 1965. The police have begun to crack down intensely, after September 2009, on yakuza ties in all aspects of Japanese society, even in the almost-sacred world of sumo. They are also making renewed efforts to turn popular opinion against the yakuza -- who are still viewed as Robin Hood-like folk heroes by much of the population.

The first DPJ politician to really get in trouble for his mob connections was Seiji Maehara, head of the DPJ from 2005 to 2006. In March 2011, he was compelled to step down as foreign minister after it was revealed that he had received donations from Media 21, a production and real estate company that served as a front for the Yamaguchi-gumi and had made donations to several other DPJ members. According to Justice Ministry sources, the Tokyo prosecutor's office is investigating Maehara for falsifying his political donations records to hide his financial connections to Media 21.

Asked for comment for this article, Maehara told me, "First of all, in regard to what the Tokyo prosecutor's office is doing, whether they are investigating -- that is something that I really know nothing about. And also in regard to the alleged relation this company [Media 21] had with organized crime, I don't know anything about that. But I was aware that there were media reports saying such things, and as a result I decided that I would return all the money that was given to me [by Media 21]."

The Tokyo prosecutor's office refused to comment on whether it was still investigating Maehara.

Of course, the issue is bigger than allegations against one official. Some have questioned whether Prime Minister Noda screened his cabinet appointments at all when selecting them for their current positions. Noda staunchly defended Tanaka, the justice minister, even after he admitted past yakuza ties. Noda himself had to return $20,000 in political donations this January after one of his supporters, the president of a discount funeral and wedding service provider, was arrested as a co-conspirator for fraud along with a yakuza member. In the recent book The Taboos of Japan No One Will Write, investigative journalist Hirotoshi Ito noted that Noda and other DPJ members received donations from the same Yamaguchi-gumi benefactor as Maehara, via different front companies. Records obtained by the author back up this claim.

The yakuza themselves may get out of this relatively unscathed. Even after his friend Tanaka's downfall, police sources say that Inagawa-kai crime boss Uchibori was not expecting to be arrested at all in October on the money-laundering charges that had been filed against him. Top members of the Inagawa-kai met covertly with weekly magazine reporters after Oct. 10, allegedly on Uchibori's orders, outing some other politicians connected to them. Police sources think the message was a warning to every politician with yakuza ties: If you fail to live up to your part of the bargain, the relationship is over and we'll make it a very messy breakup.

It was a successful threat -- Uchibori was not prosecuted for money laundering, and the charges were ostensibly dropped; no hard feelings. If one judges from the latest polls, the yakuza's friends in the DPJ probably won't be so lucky.

Frank Zeller/AFP/Getty Images

Democracy Lab

Yemen's Rocky Roadmap

Yemenis hope that a planned National Dialogue will save the revolution. But what abut the guys with the guns? 

Yemen is on edge. It's been more than a year since Yemen's longtime president, Ali Abdullah Saleh, agreed to step down from power, but calm still seems elusive. On Saturday, 17 soldiers were killed in an ambush by alleged al Qaeda militants in the restive Mareb province, where the government has appeared nearly powerless to stop frequent sabotage against oil pipelines and electricity infrastructure. To the south, recent clashes between Yemeni forces and armed locals in the province of al-Dhale have left at least three civilians dead, prompting protests about the excessive use of force and inflaming anti-government sentiments in the separatist hotbed. In the capital itself, nerves have been strained by a string of attacks on security officials by motorcycle-riding gunmen, the latest of which left a counterterrorism officer seriously wounded.

Many local officials and Yemen-based diplomats insist that Yemen's post-Saleh transition is moving forward. Such assurances notwithstanding, anxiety is rampant across the country, fueled by fears that the various factions of this divided nation will be unable to come together to prevent Yemen from falling apart.

"Yemen can't move forward in a situation like this," said Hamza al-Kamaly, an activist who was recently beaten while attending a demonstration against a Saleh-era military commander. "The country is still divided, the military is still divided, and the old regime still has a huge amount of power."

While street protests were the catalyst, Saleh's exit from power was ultimately secured by an internationally backed agreement, mediated by the Gulf Cooperation Council (GCC) last November. It was essentially an elite compromise, forged between Saleh's ruling General People's Congress (GPC) and the Joint Meeting Parties (JMP), a coalition of Yemen's established opposition parties, aimed at securing a peaceful transfer of power as the country appeared to be sliding towards anarchy. Defections by key military leaders had split the Yemeni armed forces into opposing halves. Factional clashes extended to the capital itself, and government's control over much of the rest of the country appeared to dissipate.

The immediate goal may have been securing a peaceful transition, but the terms of the GCC deal provided the outline for a much broader process. Abdu Rabbu Mansour Hadi, Saleh's longtime deputy, was tapped as a consensus candidate for the presidency, ruling along with a unity government split between the GPC and the opposition JMP during his two-year transitional term. If all goes according to plan, 2014 will see the election of a new president and a new parliament under a rewritten constitution, following the reform of Yemen's split military and the peaceful resolution of years-old disputes between the central government and increasingly powerful groups outside of Yemen's formal power structure.

But regardless of inclusive aims, Yemen's transitional process was ultimately the product of negotiations between traditional power brokers, and it was aimed at pacifying key players at least as much as it was at paving the way for a new future. Looking forward, the key question remains whether Yemen's varied political factions will be able to come together to bring the country towards stability while laying the groundwork for an inclusive democracy. And as the people prepare for the highly anticipated conference of National Dialogue, achieving said goals continues to appear to be a nearly insurmountable challenge, predicated on the ability of Yemeni stakeholders to rise above crippling divisions to make the mutual concessions necessary to make a true break with the past.

Once dismissed as an empty suit, Hadi, was thrust into the center of the storm as a relative unknown. Since he took power he has surprised some pessimists by his willingness to challenge allies of the former president. Others hope that Hadi's governance style suggests a move away from the heavily centralized rule of his predecessor. And, notably, after nearly a year in office, Hadi has retained the backing of many Yemenis and the bulk of the country's political establishment, including many fierce opponents of his predecessor.

"There is progress," said Hamid al-Ahmar, a prominent tribal leader and Islah politician who has long been one of the former president's most outspoken critics. "We believe that Hadi today is leading the country, and he is leading the revolution."

Such talk notwithstanding, the divisions within Yemen's elite linger on. The key task of military restructuring still has a long way to go. Ahmed Ali, Saleh's son, as well as General Ali Mohsen al-Ahmar, a former regime strongman who is viewed as close to the Islamist Islah party (the largest component of the JMP), still retain control of many of the nation's troops.

Meanwhile, even as many Yemenis have yearned for technocratic governance, the cabinet has proven a deeply partisan body. The government's paralysis amid mutual distrust has underscored the seemingly intractable nature of divisions between the country's leaders. Far from healing, the deep wounds splitting Yemen's political establishment have continued to fester, echoed by a divisive media climate that often seems to present competing spheres of reality.

Over a year after the agreement on the transfer of power, the hard work of the transitional period has arguably yet to begin. Attention has shifted to the upcoming conference of "National Dialogue," a key step in the transitional roadmap outlined in the implementation mechanism of the GCC agreement. The National Dialogue's stated goal is to provide an inclusive forum for representatives of a range of groups -- political factions as well as youth, women, and members of civil society -- to draft a new social contract for post-Saleh Yemen, sketching out the shape of the future Yemeni state and setting out the means for drafting a new constitution. Anticipation is high, and the consequences of failure could be dire. The president himself has warned that the failure of the National Dialogue could likely lead to Yemen's descent into a civil war.

According to the most optimistic forecasts, the National Dialogue conference could begin before the end of the year. The dialogue's preparatory committee has nearly completed its work, and both members and observers have characterized its deliberations as productive and largely respectful, despite the historical enmity between many of the factions represented. But the dialogue's success is far from assured. And while an Arab Spring-inspired uprising ultimately set into motion the events let lead to the end of Saleh's time in power, pre-2011 conflicts and power struggles continue to cast a heavy shadow over the transitional process.

In the south -- an independent country until Yemen's 1990 unification -- the activists of the Southern Movement, largely suppressed since the group's 2007 emergence, have come out empowered -- and defiant. Rejecting calls for dialogue, many of their leaders have instead raised calls for complete disengagement with Sanaa. It's a viewpoint that is by no means universal among southerners.

But as leaders in the divided grouping jockey for influence, the struggle for legitimacy has pushed many away from pragmatism. Radical voices have increasingly come to dominate the conversation. And as Sanaa-based politicians and international diplomats have strived to fulfill the transition's ambitious, fast-paced roadmap, southern leaders have stressed the need for dialogue among themselves -- which many have characterized as a near prerequisite for any possible involvement in talks on a national level -- underscoring the challenges of forming a representative body out of groups that are often far from cohesive themselves.

"It's not possible for any faction in the South to claim that it represents the south or all southerners," said Ali Nasser Mohamed, a former president of South Yemen who has yet to commit to entering the National Dialogue, commenting by email from exile in Cairo. "We hope to emerge from [internal] southern dialogue with a compromise vision and leadership that can represent the South in national dialogue."

Then there are also the Houthis, a clan once mired in a devastating, nearly decade-long conflict with the central government. They have already appeared to take the upper hand in Yemen's far North, where they have carved out virtual control in the northern governorate of Saada and parts of neighboring provinces. In Sanaa, the territory is pejoratively referred to as a "state within a state;" Houthi leaders have dismissed such claims as political posturing, stressing that the group has unambiguously agreed to enter the dialogue process.

But their participation comes amidst a tense climate. Many Yemeni politicians and foreign diplomats claim the Houthis are working with Iran, repeating longstanding accusations that the Islamic Republic has provided arms and funding to the Zaydi Shi'a-led group. For their part, Houthi leaders have countered by labeling the current government as a reshuffling of old elites, condemning Hadi for his alliance with the United States, and stressing that national dialogue will not serve as the panacea that many seem to hope it will be.

"The [GCC] initiative only allowed a wing of the regime to rule again; the people do not accept this," said Saleh Habra, the head of the Houthi's political bureau. "The dialogue comes in this context. Entering into dialogue isn't a solution."

It's a viewpoint that's shared by many across political and societal lines. Even if the National Dialogue ends up with the wide-ranging participation necessary to claim legitimacy, the conference's ability to achieve consensus -- let alone its ability to do so quickly enough to allow for elections to take place on schedule -- remains an open question. And while they've dominated discussions so far, the concerns of the Houthis and the Southern Movement will join a slate of other issues once the dialogue begins. While the participation of the GPC and the JMP has long been a given, many fear that their divisions will taint the dialogue process. And then there's the role of potential spoilers -- most notably the former president, who has resided in the capital since returning from medical treatment in the United States this February.

Beyond these factors, of course, are the deliberations of the conference itself. Subjects as diverse as women's rights, the extension of apologies and possible compensation to victims of Saleh-era conflicts, and widely discussed (though deeply controversial) ideas for changing the structure of the government to a federal or parliamentary system could very well lead to the collapse of the dialogue. Getting everyone to the table, while a key step in the process, is only one of Yemen's worries.

Expectations are high, but a general sense of pessimism is widespread. On a rhetorical level, the goals of the dialogue -- reckoning with longstanding issues while paving the way for a break with the past and establishing a mandate for an accountable, democratic governance system -- have nearly universal support, whether on the popular level or among Yemen's elite. However, on a practical level, it remains to be seen whether factions deeply invested in the status quo will be willing to make the compromises necessary to make them a reality.

The fears have been focused on the National Dialogue's potential failure, which could very well plunge Yemen into conflict. But even if the dialogue succeeds, restoring unity to this notoriously fractious country will still prove a tall order. Across the country, powerful tribal leaders maintain their hold over their own fighting forces; even the Yemeni army, many here complain, are closer to a collection of private militias than it is to a truly national military. Rather than holding a monopoly on power, the post-Saleh government often appears to be at the mercy of various factions whose interests often seem to diverge from those of the nation as a whole. In some sense, it's a thorny paradox: As the country aims to move forward, the cooperation of such divergent interest groups is key. But their continued sway, many argue, could render any progress in Sanaa moot.

"The source of Yemen's problems is clear," says Mujahid al-Kuhali, who serves as Minister of Expatriate Affairs in the unity government. "The center of power remains in the hands of certain armed groups controlled by men... who work for themselves rather than for Yemen. Until this changes, the problems will not be solved."

Photo by MOHAMMED HUWAIS/AFP/GettyImages