Photo/Illutration Komeito member Kiyohiko Toyama announces his decision to resign from the Lower House on Feb. 1. (Asahi Shimbun file photo)

A former legislator with junior coalition partner Komeito has admitted to receiving cash from a middleman suspected of illegally securing government loans for businesses hit hard in the COVID-19 pandemic, investigative sources said.

But Kiyohiko Toyama, a former Lower House member who once wielded heavy influence in the Finance Ministry, denied any wrongdoing during voluntary questioning by prosecutors, the sources said Nov. 7.

Toyama, 52, said that he accepted the money as a token of “personal support” from the intermediary, they said.

The middleman, a former adviser with Techno System Co., a Yokohama-based company related to solar power business, is suspected of illegally obtaining loans for businesses that have suffered financially because of the novel coronavirus.

The special squad with the Tokyo District Public Prosecutors Office searched offices connected to Toyama on Nov. 6 and Nov. 7. Investigators had earlier searched Toyama’s home and other places in August.

Toyama was questioned over whether he received the money in return for cooperating with the middleman over the loans, according to the sources. He denied that was the case.

“I have known the former adviser for many years and accepted the money,” the sources quoted Toyama as saying.

The middleman and another former adviser to Techno System received commissions by serving as intermediaries for businesses seeking loans from the government-affiliated financial institutions, such as Japan Finance Corp.

The two ex-advisers both failed to register as money lenders as required for such intermediary work, a possible breach of the money lending business law.

One of them asked Toyama’s policy secretary for introductions with officials of a Japan Finance branch where companies can apply for the loans.

The policy secretary arranged nearly 200 meetings between the former adviser and the officials since around April 2020, according to the sources.

In an interview with The Asahi Shimbun, the former adviser admitted to “handing 6 million yen ($52,800) to 7 million yen to Toyama” since around April 2020.

The former adviser also said he is a “supporter of Toyama and gave him 5 million yen or so annually on average since six or seven years ago.”

He denied the money was a “fee” for Toyama’s help in securing the loans.

But Toyama’s political organization did not list the money from the adviser in its income and expenditure reports on political funds.

Toyama told The Asahi Shimbun in August that most offices of lawmakers routinely refer businesses seeking loans to those in charge at Japan Finance.

“We may have had more cases than other legislators, but we have never pressured Japan Finance in terms of loan examinations,” he said.

Toyama served as senior vice minister of the Finance Ministry, which oversees Japan Finance, from September 2019 to September 2020.

Toyama, who was elected to the Lower House through proportional representation in the Kyushu block, resigned as a lawmaker in February after drawing heavy fire for visiting a nightclub in the posh Ginza district in Tokyo during the COVID-19 state of emergency.

The other former adviser to Techno System is believed to have made a similar request to a former policy aide of Masataka Ota, also a former Lower House member of Komeito.

Ota’s office has been searched.

He did not run in the Oct. 31 Lower House election to take responsibility for the allegations.

The president of Techno System was indicted on fraud charges.  

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