A ruling Liberal Democratic Party chapter headed by Takuya Hirai, minister in charge of information technology policy, has received political donations from a company penalized by the transport ministry for bid rigging, political funds reports of the chapter show.
The chapter of an electoral district in Kagawa Prefecture, western Japan, received 120,000 yen from air conditioning system maker Dai-Dan Co, which was barred in 2014 by the Land, Infrastructure, Transport and Tourism Ministry from tenders for bid rigging over construction work on Hokuriku Shinkansen bullet train line projects.
Hirai's office said it will return the money after confirming the company was penalized.
In March 2014, prosecutors indicted Dai-Dan for bid rigging over projects to install a snow-melting system along the train tracks, and the ministry barred the company from tenders for six months.
Following Prime Minister Shinzo Abe's cabinet reshuffle earlier this month, a series of political donations from bid-rigging or tax-evading companies to LDP chapters, including the electoral district branch headed by Mitsuhiro Miyakoshi, state minister in charge of Okinawa and Northern Territories affairs, have surfaced.
All the chapters have expressed their intention to return the money.
According to the political funds reports, Dai-Dan's Shikoku branch in the city of Takamatsu donated 120,000 yen in June 2014, when the ministry's penalty was still in effect.
Eight companies including Dai-Dan and their officials in charge of bidding on the snow-melting system contracts were found guilty of bid-rigging.
Hirai's office admitted that its background checks on donating companies were not thorough, but said it had not received any donation from the company since it was ruled guilty of bid-rigging in November 2014.
A Dai-Dan public affairs official said the company was not aware of any problem in giving a donation to a political party's chapter.
While Japan's political funds control law does not prohibit donations from companies involved in bid rigging, recipients in many cases end up returning the money on moral grounds after later learning of the the donor's past crime.
Hirai, a member of the House of Representatives, also served as state minister of the transport ministry and chairman of the LDP's public relations headquarters.