Nishimatsu president arrested on slush fund charges

By Chris Sleight21 January 2009

The president and four other executives at Nishimatsu Construction Company have been arrested in Tokyo on suspicion of bringing JPY 70 million (US$ 0.78 million) of undeclared funds into Japan. Local media report that Tokyo prosecutors are investigating the existence of an offshore, off-the-books JPY 1 billion (US$ 11 million) ‘slush fund'.

The arrest of president Mikio Kunisawa, who resigned from Nishimatsu the day before his arrest, comes after a six-month investigation into the company. In June last year prosecutors raided its headquarters in Tokyo on suspicion of violating foreign exchange laws. In November Kazuhiko Takahara, an executive at the company's overseas department was arrested on suspicion of violating foreign exchange laws.

Further arrests in the last week have included company vice president Keiji Fujimaki, and two executives from its overseas division, Yoshinobu Murata and Takashi Utsunomiya.

Although not one of Japan's biggest contractors, Nishimatsu had sales in the fiscal year ending March 31 2008 of JPY 432 billion (US$ 4.81 billion). It was ranked no. 102 in last years iC league table of the world's 200 largest construction companies. By iC's reckoning it is Japan's 16th largest construction company in a league table that also includes specialist house builders.

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