Tokyo Governor Inose Quits Amid Questions Over $480,000 Loan

Photographer: Haruyoshi Yamaguchi/Bloomberg

Tokyo Governor Naoki Inose speaks during a news conference in Tokyo, on Dec. 19, 2013. Inose announced today he will step down amid allegations of financial dealings with Japan’s largest hospital chain. Close

Tokyo Governor Naoki Inose speaks during a news conference in Tokyo, on Dec. 19, 2013.... Read More

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Photographer: Haruyoshi Yamaguchi/Bloomberg

Tokyo Governor Naoki Inose speaks during a news conference in Tokyo, on Dec. 19, 2013. Inose announced today he will step down amid allegations of financial dealings with Japan’s largest hospital chain.

Naoki Inose, a writer-turned-politician who captured Tokyo’s governorship a year ago, announced today he will step down amid allegations of financial dealings with Japan’s largest hospital chain.

“I don’t want to further interrupt the operations of the administration” as Tokyo prepares for 2020 Summer Olympics, Inose told reporters. “There is no way other than resigning.”

Inose said he borrowed 50 million yen ($480,000) interest free from the Tokushukai Group for “personal” reasons before he was elected in December 2012, according to the transcript of a Tokyo assembly meeting on Dec. 6. He returned the money in September, he said, after prosecutors opened a probe of the organization. Candidates for Japanese public office are legally bound to report all funds accepted as campaign contributions.

Tokushukai’s ex-chairman, Torao Tokuda, told Inose in November last year that the organization was interested in acquiring a hospital owned by Tokyo Electric Power, Asahi News reported yesterday. Takeshi Tokuda, son of Torao Tokuda and a member of the lower house of Japan’s parliament, provided the cash after his father’s meeting with Inose, the transcript said.

Sisters Arrested

Inose said at the Dec. 6 assembly meeting that he wasn’t aware of Tokushukai’s purchase plan and he didn’t discuss the issue with Tokuda, according to the transcript.

The younger Tokuda announced his resignation from the ruling Liberal Democratic Party after six associates, including two of his sisters, were arrested for election campaign fraud, the Japan Times reported last month.

Inose, 67, won the Japanese capital’s gubernatorial election last year after five years as deputy to Shintaro Ishihara, a nationalist who exacerbated Sino-Japanese tensions by seeking to purchase disputed islets in the East China Sea.

Like Ishihara, Inose was a writer who was drawn into politics late in his career. He won literary fame for nonfiction works on Japan’s World War II defeat and the life of nationalist writer Yukio Mishima.

Essays by Inose on the need for bureaucratic reform and the privatization of national highways drew the attention of former Prime Minister Junichiro Koizumi, who named him to an advisory position.

Inose made Tokyo’s bid for the 2020 Olympic Games a centerpiece of his election campaign last year and followed up by delivering a winning presentation to the International Olympic Committee that emphasized the city’s safety, efficient public transportation and financial stability.

To contact the reporters on this story: Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net; Takashi Hirokawa in Tokyo at thirokawa@bloomberg.net

To contact the editor responsible for this story: Brian Fowler at bfowler4@bloomberg.net

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