Trial opens for Japanese political powerbroker

October 6, 2011 - 7:25 AM
Japan Politics Trial

Democratic Party of Japan's veteran Ichiro Ozawa arrives at Tokyo District Court in Tokyo Thursday, Oct. 6, 2011. Ozawa is standing trial in a political funding scandal related to a murky 2004 land deal. (AP Photo/Kyodo News) JAPAN OUT, MANDATORY CREDIT, NO LICENSING IN CHINA, FRANCE, HONG KONG, JAPAN AND SOUTH KOREA

TOKYO (AP) — The behind-the-scenes powerbroker for Japan's ruling party denied any wrongdoing Thursday as he went on trial in a political funding scandal that could undermine his influence and the struggling party's unity.

Ichiro Ozawa, who engineered the Democratic Party of Japan's rise to power in 2009, was charged this year for allegedly overseeing false accounting by his former aides in a murky 2004 land deal.

Prosecutors say that Ozawa was fully aware of the false bookkeeping by the three aides to cover up questionable funds used in the land deal, and that he authorized the false entry of the transaction in an annual political funds report to the government.

Ozawa, 69, told the Tokyo District Court on Thursday that he is not guilty.

"There is no such fact," Ozawa said, denying the allegations. "There was no erroneous bookkeeping, and I have never conspired with anyone."

Ozawa said his indictment was based on "unjust and illegal" investigation. "This is a wrongful trial and should be stopped immediately," he said.

The three former aides were convicted last month over the case and have since appealed.

The scandal has damaged Ozawa's ambitions to become prime minister, though he still wields considerable influence within the party. The trial is being closely watched in Japan, where Ozawa generally has a negative public image as an old-style wheeler-dealer. More than 2,100 people lined up Thursday for 49 seats in court. The trial is likely to take months, with a ruling expected in April.

A fixture in Japanese politics for decades, Ozawa has championed reforms, such as deregulation, giving more authority to regional governments and reining in Japan's powerful bureaucrats. His 1993 book, "Blueprint for a New Japan," argued that Japan needed to reform its political system and take a more active role in international affairs, garnering significant attention in Washington.

The focus of the trial is whether Ozawa can dispel his suspected conspiracy with the aides over the bookkeeping. Prosecutors say the aides had no control over the land deal without instructions from Ozawa, their powerful boss.

The three aides, who were tried as a group, were given suspended prison terms of up to three years for failing to register a 400 million yen ($5.2 million) loan from Ozawa to his funding body in the Tokyo land deal and for accepting 100 million yen ($1.3 million) in illegal donations from a construction company.

Opposition lawmakers have demanded Prime Minister Yoshihiko Noda's 1-month-old government order Ozawa to testify in parliament to provide a full explanation about the scandal. That could hold up parliamentary deliberations on key legislation, including extra money in the budget for disaster reconstruction. Ozawa has repeatedly refused to testify in parliament, citing his pending trial.

Noda said Ozawa's indictment was "regrettable," but questioned whether it was appropriate to question him in parliament while the trial was going on.

Despite the scandal, Ozawa has continued to wield a great deal of influence and has a loyal core of supporters within the party. Last year, he lost a party leadership vote to then Prime Minister Naoto Kan, but several months later played a key role in pressuring Kan to resign.

Ozawa is standing trial after a judicial panel comprising ordinary citizens sought his indictment, despite earlier decisions by prosecutors to drop the case due to insufficient evidence.

Ozawa alleged that his indictment was an "abuse of state power intended to eliminate me socially and politically."

Some critics say the panel's decision might have been based on a preconception of Ozawa's poor public image rather than hard facts.

"This trial is making an issue out of nothing," said Ozawa's chief defense lawyer, Junichiro Hironaka. "Naturally, we are going to win the case."