Tokyo Underworld

by Robert Whiting

  The quotes and other descriptive material about TSK.CCC came from magazine articles about the opening day reception in the Shukan Shincho, ‘Machii Hisayuki to iu Otoko’ [‘A Man Called Hisayuki Machii’], July 26, 1973, pp. 32–34; and the Shukan Bunshun series article, June 23, 1977, pp. 152–57, June 30, 1977, pp. 146–50; and July 7, 1977, pp. 144–49 entitled ‘Kankoku Kara Kita Otoko’ [‘The Man Who Came from Korea’]. The author also relied on interviews with Zappetti and Roa and his own firsthand experience. The book Yakuza contains a summary of Machii’s career (pp. 191–97).

  The description of the Cupid incident and its aftermath was provided by Richard Roa.

  The Lockheed scandal and Kodama’s role in it are discussed extensively in a number of excellent works, not the least of which is Anthony Sampson, The Arms Bazaar: From Lebanon to Lockheed, and Inose Naoki, Shisha Tachi no Rokkuiido [The Lockheed Dead].

  Also see, ‘Rokkuiido Kenkin’ [‘Lockheed Donations’], Shukan Yomiuri, special issue, February 28, 1976. Koichiro Yoshiwara, ‘Burakku Rokkuiido’ [‘Black Lockheed’], Shukan Yomiuri, April 3, 1976, pp. 42–45; Takashi Tachibana, ‘Kodama Yoshio to wa Nanika?’ [‘Who Is Yoshio Kodama’], Bungei Shunju, May 1976, pp. 94–135; Tad Szulc, ‘The Money Changer’, The New Republic, April 10, 1976; ‘Kimi Wa Kodama Wo Mitaka?’ [‘Have You Seen Kodama?’], Asahi Journal, June 11, 1976; and the Hearings Before the Subcommittee on Multinational Corporations of the Committee on Foreign Relations, US Senate, 94th Congress, February 4 and 6, and May 4, 1976.

  In addition, there is the aforementioned Dixon piece, in the January issue of 77, Pacific Community; ‘Hawaii Kaidan Kuirima Hotel No Hishitsu De nani Ga Atta Ka’ [‘What Happened in a Private Room at the Kurima Hotel during the Hawaii Conference’], Shukan Bunshun, February 1, 1979, pp. 156–60; ‘The Selling of Japan’, The Nation, February 13, 1982, pp. 171–78; and ‘Black Current’, Japan Times, April 1, 1992. Kotchian’s exorbitant expenses are noted in Inose Naoki, Shisha Tachi no Rokkuoodo Jiken [The Lockheed Dead], pp. 223, 224.

  The ‘bribery, as a business expense’ quote appears in Sampson’s The Arms Bazaar. Bribes are also described in Williams Horsely and Roger Buckley, Nippon New Superpower, p. 129; and in the aforementioned Dixon article on structural corruption. Also see the excellent Shadow Shoguns, by Jacob M. Schlesinger, for an in-depth study of Tanaka’s highly suspect political fund-raising tactics.

  The ‘If they had wanted to, they could have stopped it’ quote is from Sampson, Arms Bazaar, p. 223. The April 2, 1976, edition of The New York Times, quoted a CIA agent as saying that the agency ‘was checking with headquarters every step of the way, when the Lockheed thing came up. Every move was approved by Washington.’

  ‘How dare they’ quote is drawn from Horsley and Buckley, Nippon New Superpower, p. 129.

  See Rokkido Saiban Bochoki [A Record of the Lockheed Trials] Asahi Shim-bun, 1994, vol. 1, pps. 132–35; 184–86; 196–99 for Tachibana’s analysis of the missing bearer checks and the $200,000 Osano payment at LAX. Also see interview with Takashi Tachibana in the monthly magazine Ushio, November 1976. For another discussion of the theory on secret campaign donations, see an article in the Mainichi Daily News, March 15, 1976, p. 4, ‘Nixon Said Implicated in Lockheed Bribery’.

  The Lockheed aftermath is discussed in the aforementioned Naoki, Shisha Tachi no Rokkido. Its effect on the Machii organization is described in the Shukan Bunshun series (Kankoku Kara Kita Otoko) and in ‘Ginza No Senryo No Shussen Wo Tsugeru TKS.CCC no ‘Banka’ [‘The Elegy of the TKS.CCC’s Postwar Occupation of the Ginza’], Shukan Shincho, May 26, 1977, pp. 42–46; and in ‘Kurabu’ [‘Club’], Shukan Shincho, January 8, 1977, pp. 130–31.

  Also see Yoichiro Tanaka, ‘Rokkido Jiken Wa Sagi Jiken?’ [‘Was the Lockheed Incident a Sting Operation?’], Shukan Bunshun, March 1, 1979, pp. 46–47.

  Kissinger’s court order was discussed in Tad Sculz, ‘The Money Changer’, New Republic, April 10, 1976.

  The Mainichi Daily News of June 13, 1976, listed eight people related in one way or another to the payoff scandal who died under ‘mysterious circumstances’, including a police inspector investigating Lockheed who killed himself by leaping into Tokyo Bay. The excellent book Shisha Tachi no Rokkuiido describes them in detail.

  See Asahi Shimbun, evening edition, April 27, 1984, p. 1 for reports on Osano’s conviction.

  The Supreme Court verdict of ANA’s Wakasa was upheld in 1996; it was widely reported in all the Japanese newspapers, as was his company’s response.

  For an excellent essay on how Tanaka managed to bend the system to suit his purposes, see Inoki, pp. 245–50.

  The most complete and authoritative work on the Lockheed scandal remains Tachibana’s four-volume Rokkido Saiban Buchoki, which was published in paperback in 1994.

  CITIZEN NICK

  Material on Koreagate was obtained from the US Congressional Report, Hearings Before the Subcommittee on International Organizations on International Relations, ‘Activities of the KCIA in the US’, March 17, 1976; also Japan Times, June 4, 1977.

  In the Fujita case, the author relied on interviews with Zappetti, Vince Iizumi, Akio Nomura and Yutaka Mogami, who were closely involved. Fujita is now dead. Said Nomura, a close friend of Fujita’s, ‘What Fujita did was wrong. But I understand why he did it – Nick treated him too badly.’

  The Grolier editorial incident came from interviews with Grolier executives Richard Walker, Hiroo Nakao and Phil Yanagi, who were caught in the middle of the conflict.

  DEA CULTURAL WALL

  Sessions and Mueller gave their testimonies before the US Senate in November 1991. See US Senate Report on ‘The New International Criminal and Organized Crime’, 1993.

  In addition to the aforementioned fifty-nine page Senate report, the material on the DEA in Japan is from a three-part series entitled ‘Japan’s La Cosa Nostra’ by Hiroaki Furano of the Kyodo News Agency, released in February 1984, as well as from interviews with a US crime investigator who wishes to remain anonymous, and Steve Weissman, who was with the Tokyo Bureau of the New York Times in the early 1990s and was covering the subject. Also see ‘Roppongi Konnekushon’ (‘Roppongi Connection’) in the Shukan Asahi of June 7, 1991, pp. 20–23, for material on the underground drug scene in Roppongi and the arrest of Shintaro Katsu, and the feature article ‘Yakuza No Keizai Gaku’ (‘Gangster Economics’) by Atsushi Mizoguchi in the now defunct monthly magazine Marco Polo, November 1991, pps. 60–69.

  7. THE GREAT TRANSFER OF WEALTH

  A NOTE ABOUT EXCHANGE RATES

  The dollar was fixed at 360 yen to the dollar in 1949 and stayed there until 1971, when it was taken off the gold standard by then US President Richard M. Nixon and allowed to float against other currencies. The move was designed in part to alleviate the $3 billion trade imbalance with Japan. It slipped to 300 yen in a matter of months, then to 240 (and to 190 by the end of the decade), before being revived in the Reagan administration, when it rose to a plateau of 263 in February 1985.

  The move off the gold standard was one of the year’s two ‘Nixon shocks’, as the Japanese referred to them. The other was the surprise announcement by Nixon that Henry Kissinger had been carrying out secret negotiations with the Chinese government to establish diplomatic relations without consulting with or even notifying the Japanese government, which the latter saw as a humiliation.

  However, the doru shokku, as it was known, gave the Japanese unprecedented spending power and provided further impetus to Japan’s growth.

  For a description of the G-5 Plaza Summit of 1985, see James Fallows, Looking at the Sun. Trade and financial statistics on Japan for the period are from Japan Almanac data provided by MITI, MOF, and other government agencies. The bar and nightclub count comes courtesy of Azabu Ward Office. Educational statistics are from World Almanac.

  ‘The Greatest Transfer …’ quote came from Kenneth Courtis, an economist with Deutsche Bank, Tokyo.

  The ‘… essentially racists …’ quote is
from John Roberts.

  Additional US–Japan trade data and information provided by ACCJ and the Boston Consulting Group.

  Construction data came from the Japan Almanac (courtesy of the Ministry of Construction), which pointed out that Japan in the 1990s had twice as many cars as in the 1970s but only one-tenth more road space, thereby justifying the increased construction of highways. See Patrick Smith, Japan: A Reinterpretation, pp. 180–82, for an excellent essay on the construction state; and Schlesinger, Shadow Shoguns, pp. 240–41.

  The pig farming saga was related by Zappetti, Aksenoff, and Vince Iizumi. Hog farming data are from Japan Almanac (Ministry of Agriculture, Forestry and Fisheries).

  KEIZAI YAKUZA

  ‘Tani’ is a pseudonym for a Roppongi gangster.

  Miyashiro’s US arrest record appears in Kaplan and Dubro, Yakuza, p. 248. Miyashiro was also profiled and interviewed in the Shukan Taishu weekly magazine article ‘Kore Ga Daigaku No Oyabun Da’ [‘These are the College Gang Bosses’], January 29, 1990, pp. 38–47. He was also interviewed in Mark Schilling’s ‘After Dark’ column, Japan Times Weekly, August 3 and 10, 1991.

  Kobayshi’s role in the election of Nakasone is described in part 1 of a twelve-part series, ‘Politicians and Gangsters – The Unholy Alliance’, appearing in the Mainichi Daily News, beginning on May 4, 1991, p.1. (During the 1982 campaign for LDP president, Nakasone had been harangued by right-wingers from Kobayashi’s Nihon Seinensha, protesting his ties to LDP kingmaker Kakuei Tanaka, who was being tried for bribery in the Lockheed affair. Nakasone’s associates made a request through certain channels and the harassment suddenly stopped.

  The 1985 police investigation that uncovered over 100 instances of extortion by the Roppongi office of the Kobayashi-kai was reported in the October 15, 1985, issue of the Asahi Shimbun (Yukan, or evening edition), p. 11. Other data on the Kobayashi-kai came from Yomiuri Shimbun, June 20, 1993.

  Katsushi Murata’s life and exploits were described in ‘Jiken No Ato’ [‘After the Scandal’], Shukan Sankei, December 2, 1982; in the Sunday Mainichi, April 9, 1989, pp. 220–21; in ‘Hanin Ga Kataru’ [‘The Criminal Talks’], Shukan Shincho, December 2, 1989, pp. 129–31; and Oshita Eiji, Eikyu No Rikidozan.

  A NOTE ABOUT THE END OF THE OLD YAKUZA ERA AS REPRESENTED BY KATSUSHI MURATA

  During a period of several years, beginning in the 1980s, there was a public revival of interest in yakuza, ignited by a best-selling novel about gang and prison life, Hei No Naka No Korenai Men Men [Those Behind Walls Who Don’t Learn Lessons], penned by a retired gangster named Joji Abe, which made him wealthier than he had ever been in his previous life. Abe’s success inspired other such works: a best-selling novel about yakuza wives, Gokudo No Onnatachi [Gang Women], which became a hit movie and was followed by several book and film sequels. Among them were The Lonely Hitman, a book based on a real-life antique dealer in Osaka who rubbed people out in his free time, which sold 180,000 copies and was also turned into a film; and a popular nonfiction book and movie, and Kizu [Scar], depicting the life of a famous Shibuya gangster, Kei Hanagata. Abe even had his own talk show on Asahi TV.

  Sociologists explaining the phenomenon said that the Japanese were drawn to the world of the gokudo (villain) and its strict moral code of honor and obligation because those traditional values were disappearing from modern Japanese society. And Abe was the first to agree, for he believed that the real gokudo, as he knew them, were fading way as well – which was somewhat ironic, given the suspicions that the old bakuto and tekiya had once held for members of Abe’s generation.

  ‘For many years, up until the time of the Olympics,’ he said in an interview, ‘being a yakuza meant living by a certain spirit and code – being unafraid, sacrificing yourself for others. The yakuza I knew put value on giri and jingi – duty and loyalty. It all began to change as Japan began to accumulate vast wealth. A new breed of gangsters appeared whose sole interest was money.’

  No better example of the dying breed of mobster existed, said Abe, then his prison cellmate, Katsushi Murata, famous all over Japan as the man who killed Rikidozan.

  Murata was given grudging respect, even by the authorities. Gushed an admiring police investigator, a man who had once arrested Murata on suspicion of gambling, ‘The man has ability and talent. He has a way of running his gambling sessions that one can’t easily detect. What’s more, Murata has a strong character. If you don’t have something special, you don’t rise to the top rank in a gang the way he did.’

  Murata made the national headlines once more in 1989, but in a way that none of his admirers had ever imagined, when suddenly, he was in jail again – arrested on suspicion of aiding and abetting his wife in a case of assault and extortion. According to police reports and press accounts, the trouble stemmed from an unpaid loan in the sum of 1,200,000 yen that Murata’s wife, Megumi, had guaranteed on behalf of one of her hostesses. The hostess, a nineteen-year-old minor identified only as ‘A’ by police, had been paying the money back in monthly installments and had whittled the debt down to 700,000 yen when medical expenses for a sudden illness caused her to halt payment. Late one frigid night in February, Megumi and her husband broke into ‘A”s suburban Tokyo apartment and, according to police reports, began punching and kicking the teenaged hostess. When ‘A’ sought refuge in the toilet, Megumi pulled her out by the hair and continued the assault. Unable to locate any cash, ‘A”s assailants left, but the next evening, Megumi returned with a truck and three of her employees, who hauled away some of ‘A”s belongings, including a laser disc, a stereo, a washing machine and an electric gas range, worth an estimated 1.2 million yen. The police issued several arrest warrants. Murata, who checked his various pets into a neighborhood pet clinic prior to turning himself in, told police that he had only stood by and watched. The investigator on the case, noting how worn and flabby his suspect appeared, said he believed it. ‘With his diabetes,’ he told reporters, ‘he doesn’t look like he has the energy to hit anyone.’ See Yukan Fuji, March 25, 1989; Sankei Shimbun, March 25, 1989; ‘Hakaba No Kage De Rikidozan Mo Naiteiru?’ [‘Is Rikidozan Crying in the Shadow of His Grave?’], Sunday Mainichi, August 19, 1989. The charges against Murato were dropped and his wife settled out of court.

  An excellent article on the old and new versions of the yakuza was ‘The Honourable Mob’, The Economist, January 27, 1990, pp. 21–24.

  An excellent survey of the keizai yakuza was the cover story of the November 21, 1991, edition of the Far Eastern Economic Review, pp. 28–35, entitled ‘Power to the Yakuza’.

  ‘Total annual revenue … exceeded that of … drug trafficking’ and ‘lender bank in the Pebble Beach transaction – mob connected’, from ‘A Japanese Laundry Worth $1 Billion?’ Business Week, May 24, 1993, p. 30.

  Also informative was ‘The New International Criminal and Asian Organized Crime Report’, prepared by the US Senate in 1993, after extensive hearings. It focuses on money laundering, Ken Mizuno, and Minoru Isutani, among other subjects.

  Ken Mizuno descriptions and currency law violations charges also appear above, and in ‘Fraud Suspect Amassed Huge Gambling Debts’, Japan Times, March 29, 1992, p. 2; the Mainichi Daily News, issues of April 29, 1992, ‘Golf Club Developer Declared Bankrupt’; May 14, 1992, ‘Four Charged with Tax Evasion in Golf Club Membership Sales’, and June 14, 1992, ‘Mizuno Illegally Funneled over 32 Billion Yen to U.S.’. Also see ‘Ken International Ordered to Pay 13.4 Billion Yen in Back Penalty Taxes’, Asahi Evening News, June 12, 1992, p. 4; ‘U.S. Agents Seize Ken Mizuno Resort’, Mainichi Daily News, August 20, 1992, p. 4; and ‘Mizuno Group Pleads Guilty in Golf Membership Scam’, Mainichi Daily News, October 16, 1992, p. 12.

  Also see ‘Agents Seize Palm Springs Resort of Japanese Tycoon’, Los Angeles Times, August 19, 1992, p. D-2. ‘High Roller’s Past, Fortunes Fueled Probes’, by Karl Schoenberger, Los Angeles Times, March 16, 1992, p. A-1. ‘Mizuno’s Former Company Agrees to $65 Million Forfeiture’, U.P.I. October 5, 1993. �
��Japanese Firm Agrees To Forfeiture’, by Karl Schoenberger, Los Angeles Times, October 5, 1993, p. D-3. Also ‘Gorufu Gyokai No Mondai Oni, Mizuno Ken to iu Otoko’ [‘The Problem Ogre of the Golf World: A Man Called Ken Mizuno’], Shukan Bunshun, September 12, 1991, pp. 194–97’, and ‘Mizuno Ken Moto Scacho, 11 Nen Choeki’ [‘Former President Ken Mizuno Sentenced to 11 Years’], Asahi Shimbun, Yukan, March 25, 1997, p. 14.

  BANKS, BOB HOPE, AND PRESCOTT BUSH

  The mob-backed Hope Golf Club scam episode was related by American Richard Roa, who was the Tokyo sales manager for the organization and was caught in the middle of the scam. Certain details were confirmed by Hope’s lawyer at the time, Ed Barner. Desmond Muirhead, a golf architect involved with Hamada and Nicklaus, confirmed other details of that particular venture, as did Takeaki Kaneda, a former national golfing champion in Japan and a Sports Illustrated representative in Tokyo who unsuccessfully tried to warn Nicklaus away from the deal. Kaneda said that Nicklaus told him years later he wished he had listened to Kaneda’s advice.

  A NOTE ABOUT MOB TAKEOVERS

  Yakuza moneylenders have used their loan operations as a very effective takeover wedge, which gives the lie to MOF claims that the Japanese system of managed capitalism was somehow better than that of the United States because it prevented leveraged buyouts.

  One very good example of such a takeover involved the Arabian Nights restaurant, which opened in 1985 on a Roppongi back street. Owned and operated by an Iraqi businessman, it was one of the most beautiful restaurants in the city. All the decor, including the gold-plated fixtures, was imported from the Middle East, as was a chef who specialized in Arabic food.

  It cost the Iraqi $2–3 million to get the operation off the ground, plus an extra $2 million he borrowed from a Japanese bank to get the lease. But business was slow and costs were surprisingly higher than usual. Unbeknownst to the owner at the time, the meat, the vegetable, and the oshibori (hot towels) vendors were all friends of the Japanese floor manager and were charging double the going price for their wares.