Soka Gakkai Defrauds Japanese Government
Evades Taxes In Insurance Scam of more than
U.S. $10 Million
According to the Weekly Post of 11/25/94, Soka Gakkai has committed
insurance fraud in forty-two documented cases (Twenty-two in Tokyo; eighteen
in the area just outside of Tokyo; one in Osaka; one in Kyushu) and evaded
taxes in excess of U.S. $10,000,000.00 (Ten million) in the twenty-two
cases in Tokyo, alone. It is highly likely that more cases will become documented
and that the money involved will rise as investigations into the Gakkai's insurance records continue.
The insurance, a type that was established for small, family run businesses,
is "long term inclusive insurance." It was devised to cover small businesses where
an individual's residence serves also as one's place of business and for businesses where part of the property is set aside for permanent occupancy as one's place of residence. A typical example of this second type of business arrangement is one where a family/owner has a shop on the first floor of a single family dwelling unit and the family residence on the second. The Ministry of Finance defines the prerequisite conditions for eligibility for this insurance as "permanent occupancy and place of residence" and "the place one determines as one's permanent residence and uses as the basis for living." Further, this insurance is recognized for tax purposes as a "financial loss." Therefore,
the small business is given a break and can get a tax write-off.
The Gakkai committed fraud when it purchased this insurance for, among other properties, the Soka Gakkai Headquarters in Tokyo, the Seikyo Newspaper Headquarters office building (in the same area), the Kansai Seikyo Newspaper Headquarters, and the Kyushu Seikyo Newspaper branch office building. Further,
the Gakkai's for-profit newspaper company, the Seikyo Newspaper purchased large amounts of this insurance to reduce its taxable income and thereby committed tax evasion.
The insurance is different from the usual type of "pay as you go" insurance in
that it can be purchased to cover periods of three, five and ten years. Further, a
small percentage of the insurance amount is set aside. That amount accrues
interest and, at the end of the specified period, ten percent of the insurance amount
plus interest accrued on the amount set aside that is above an estimated amount
of interest earnings is returned as a "gift of gratitude" to the insured.
In Japan, gifts are not included among taxable income. The Gakkai, in addition to committing fraud and tax evasion in fourty-two instances, illegally received more than
one million dollars in bogus "gift (kickback)" payments.
List of Fradulent Insurance Policies:
(Part 1)
Insurer: Tokyo Kaijo K.K. (Tokyo, Japan)
Policy Holder: Soka Gakkai (Tokyo, Japan)
| Policy no. |
Amount (Yen) |
Term |
Insured Items |
| 5011478189-0 |
135,449,600 |
`89-3-31 -`94-3-31 |
Office, Altar |
| 5011478188-0 |
73,216,000 |
`89-3-31 -`94-3-31 |
Altar |
| 5011478190-0 |
52,166,400 |
`89-3-31 -`94-3-31 |
Altar |
| 5161987008-0 |
73,320,000 |
`94-1-31 -`99-1-31 |
Altar |
| 5161987009-0 |
135,642,000 |
`94-1-31 -`99-1-31 |
Altar |
| 5161987010-0 |
52,240,500 |
`94-1-31 -`99-1-31 |
Altar |
(Part 2)
Insurer: Tokyo Kaijo K.K. (Tokyo, Japan)
Policy Holder: Seikyo Newspaper Company (Tokyo, Japan)
| Policy no. |
Amount (Yen) |
Term |
Insured Items |
| 8416000752-0 |
30,636,000 |
`84-5-25 -`94-5-25 |
Seikyo Newspaper Co. |
| 8416000901-0 |
22,200,000 |
`84-6-1 -`94-6-1 |
General purpose items |
| 5011183154-0 |
4,834,200 |
`89-3-31 -`99-3-31 |
Office |
| 5011183155-0 |
20,142,500 |
`89-3-31 -`99-3-31 |
General purpose items |
| 5043322979-0 |
9,152,000 |
`90-2-25 -`95-2-25 |
General purpose items |
| 5043322980-0 |
18,304,000 |
`90-3-1 -`95-3-1 |
General purpose items |
| 5091911039-0 |
9,604,400 |
`91-11-1 -`01-11-1 |
Office, store, misc. items |
| 5161961867-0 |
62,965,030 |
`94-7-1 -`04-7-1 |
Seikyo Newspaper Co. |
| 5161961868-0 |
26,493,000 |
`94-7-1 -`04-7-1 |
Seikyo Newspaper Co. |
| 8624244946-0 |
46,820,000 |
`87-2-27 -`97-2-27 |
Office, misc. items |
| 8724060661-0 |
72,520,000 |
`87-5-31 -`97-5-31 |
Office, misc. items |
| 8724064057-0 |
7,251,300 |
`88-3-1 -`98-3-1 |
General purpose items |
| 8724064071-0 |
8,057,000 |
`88-3-1 -`98-3-1 |
General purpose items |
| 9830387586-0 |
70,333,760 |
`92-10-29 -`02-10-29 |
Office |
| 9830468658-0 |
68,612,000 |
`93-9-16 -`03-9-16 |
Office, misc. items |
| 9830468659-0 |
29,866,400 |
`93-9-16 -`03-9-16 |
Office, misc. items |
1,029,826,090 Yen = Total for twenty-two fradulent insurance
policies as listed above. At the exchange rate of 100 yen to one
U.S. dollar, 1,029,826,090 Yen = U.S.$10,298,260.90.
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