Category Archives: Underground Economy

Yakuza Not Leaving The Construction Industry With A Whimper But A Bang

Under the guidance of the National Police Agency, the construction industry is taking great steps to remove yakuza (boryokudan) and other anti-social forces from public works projects and all aspects of the construction industry. Apparently, the yakuza are not happy with this new impetus. On the morning of October 12th, in Tokyo Shinjuku-ku Kami Ochiai 4-chome, a gun was found near the entrance of a demolition and construction site for Seibo University. The Tokyo Metropolitan Police Totsuka PD were notified and found that a shot had been fired through the steel fence surrounding the construction site. The gun found at the scene was an automatic with several rounds still intact.

According to news reports, an unidentifed man working close to the site, heard sounds like a tire being punctured at 2:40 am on the same day. Since October of last year, there have been four other construction sites in Tokyo where bullets were fired.  The construction company working on the Seibo University site has gone on record that it will be severing ties with all organized crime groups and implementing that policy in its larger public works as well.  Police sources believe that this case was a clear warning by an organized crime group, hungry for construction projects, that they will not be easily dismissed.  The relationships between this shooting and previous incidents is unclear. If you were in a punny mood, you could say that gunshots represent yakuza “destructive criticism” of the new policies rather than the usual “constructive criticism” that one would hope for from these chivalorous groups.

"Don't fear the yakuza, pay them off, or use them." from the Tokyo Metro Police HP. Tokyo is actively trying to push the yakuza out of construction and the business world. New ordinances will add impetus.

Prior to this incident, on October 6th, the 19th annual Tokyo Citizens For the Banishment of Organized Crime Meeting/Boryokudan Tsuiho Tomin Taikai (暴力団追放都民会)was held at the Hibiya Kokaido and participants, which included several construction company executives, pledged “Not to fear organized crime, nor to give them money, nor to use their services.”The Tokyo City Government is expected to pass an organized crime exclusionary ordinance (暴力団排除条例)  this year which will make paying off the yakuza (指定暴力団)a crime, and will also allow the police to release the names of companies that do business with the yakuza. Seven prefectures already have similar laws on the books. The new laws will make the price of paying off the yakuza, in loss of face and in penalties,  much more expensive than the actual cash payments to the yakuza.  It highly incentives firms not to cooperate or collude with organized crime, much as the revisions to the commerce law in December 1997, made it unacceptable for large listed companies to pay off sokaiya (総会屋)ie racketeers. After a few company executives were arrested for “giving profits to racketeers” the pay offs drastically declined as did the number of sokaiya.

For footage of the construction site and more details see the NHK News Report.

Note: On a more serious note, for the safety of the construction firms and their employees, that are being targetted for reprisals by organized crime, we have omitted the company names from the article.

Upcoming Event: Polaris Project seminar

Jake will be giving a talk about the law-enforcement side of fighting human trafficking at Polaris Project’s monthly seminar series, “You Know Human Trafficking?”

Date: Saturday, September 25 from 7-9pm

Location: JICA Chikyu Hiroba Seminar Room 301 (Map)
(One-minute walk from Exit 3, Hiroo Station, Tokyo Metro Hibiya Line)

Admission: 1,000 yen, 500 yen for students with ID

To register for the seminar, please fill out this form (Japanese only),

For more information, contact:
Polaris Project Japan Office

Reports of Nagoya tournament suffering due to sumo scandal

Amongst much controversy, the Grand Sumo Nagoya Tournament has gone on (mostly) as planned, despite NHK’s refusal to broadcast the event and a boycott by a number of sponsors (but not McDonalds!). It’s far from business as usual, however, as an increased police presence and visible security cameras don’t make sumo fans feel quite as welcome as in previous years.

The Mainichi ran an article recently about how the the tournament has been affected, citing an increase of empty seats as just one of the issues facing his highly-monitored event. A great bit of flavor comes from an account of two fans who got into a fight because one offhandedly said the other looked like a yakuza:



At the end of the second day of the tournament, a 62-year-old man from Aichi Prefecture who was wearing black sunglasses was exciting the arena when a fellow fan mumbled, “bouryokudan…” The two got into an argument that ended after security guards intervened.

The man with the glasses commented angrily, “How dare he mistake me for a gang member. It’s really insulting. The whole atmosphere here is really strange. Maybe they shouldn’t have held the tournament at all.”

The article goes on to report that a woman in charge of the information desk at the tournament says that they haven’t gotten even half the number of viewers they typically host and that there’s been a number of cancellations.

Comments from those who did attend the tournament seem to indicate a common sentiment that the entire thing has been blown out of proportion. One 60-year-old local said he thinks the punishment against Kotomitsuki  is too harsh for just gambling on baseball, while a middle school student commented that he wished the Sumo Association “would consider the fans.”

Other news reports tell tales of a large but still disappointing turnout on the first day. While 90% capacity is considered “full house” for the event, the July 11 opening reportedly saw 7,200 of the 8,100–or 89 percent–of the arena’s seats filled. This year was the first since 1985 that the tournament couldn’t roll out their “manin onrei banner,” signaling a full house. Reports of the second day, cite attendance numbers even lower at only around 4,500–800 fewer than last year.

A number of sponsors have also pulled out, leaving the tournament with around 80 percent fewer prizes than in past years. It was reported that on the second day of the event had only 12 gifts, the third 10, and according to the Mainichi, today saw only 11. Understandable that Japanese companies are pulling out sponsorship in the face of scandal (some of us probably remember the heat sponsors gave poor Tsuyoshi Kusanagi after his romp in Roppongi), but it certainly can’t be very encouraging for wrestlers who are already battling it out to a bunch of empty seats.

Fuzoku Friday: In the news this week

A couple things going on in the fuzoku world this week:

In a move to put a stop to illegal deai-kei cafes, the National Police Agency announced they will tighten regulations regarding love hotels from January of next year. Although the businesses appear to be love hotels, they do not meet standards set by law and some are used as a location for enjo-kosai. Says the Mainichi Daily:

There are about 3,590 facilities that closely resemble love hotels but are not recognized as such because they do not meet the standards set by the current law, according to the NPA. About 80 percent of them are situated in areas where adult entertainment businesses are prohibited by law.

According to the Asahi, the new regulations will specify that love hotels are businesses that have “rest” and “stay” prices displayed in front of the building, have an entrance that is shrouded by curtains or some other obstruction, and may be used without seeing employees face-to-face. Those under 18 years of age must be prohibited from entering, and the business cannot be within 200 meters of a school.

Also from the Mainichi Daily (and a great AP article here), Japan has finally begun to respond to international pressure regarding child pornography, with the National Police Agency and other government ministries pressuring the Ministry of Internal Affairs and Communications to agree to ban access to websites dealing in child porn instead of simply demanding site owners delete them. Despite some concerns that the move may be an infringement of freedom of expression, most seem to welcome the plan. And it couldn’t come sooner, as the day after the announcement was made police reported that seven child pornography sites–five “ranking” sites and one run privately–had been discovered and the owners ordered to shut them down. Still waiting for them to get their act together on the junior idol stuff..

Back on the fuzoku topic, it was reported today that a Dentsu employee was arrested for running a nightclub in Kanagawa Prefecture that illegally employed Filipino waiters and hostesses. The man started the club in August 2006, reportedly trying to pay off debts he accumulated through “entertainment” and the purchase of a 43 million yen condo. To staff the pub, he started a fake web design company to get work visas for the Philippine nationals. As we learned earlier, Dentsu is known as being quite the harsh taiikukai-kei company, so you have to wonder where the entrepreneur found the time to run his other operation.

The Otaku Sex Industry: sometimes, the real thing is better?

by John Pakarnian (writing for Japan Subculture Research Center)

Moe Tokyo (Welcome to a brave new world)

Taku Hachiro is probably the most unlikely sex symbol in the world. A talento known for his personification of the ultimate otaku stereotype, this Shizuoka native’s long stringy hair, portly figure and gopher-like posture might make him better suited for the back corner of a video arcade than ads for the sex industry. But for over a year he has been promoting deai [hook-up] sites in manga magazines. In today’s poor economy, peddlers of pleasure will do anything to attract new customers, including taking on an otaku image.

Otaku have been booming in the popular consciousness since 2005, when Fuji TV aired its prime time drama Densha Otoko, a beauty and the beast romance starring an otaku. Women’s magazines raved about how the show championed otaku as new potential partners for middle-aged career women, but otaku remained incredulous. That same year, Toru Honda wrote Dempa Otoko, a manifesto calling for otaku to abandon “love” for human females and embrace “moe” for two-dimensional characters. His book sold 33,000 copies in three months, and fans planted signs in Akihabara reading, “Real Otaku Don’t Desire Real Women.”

But Honda is the voice of an extreme minority.

Continue reading The Otaku Sex Industry: sometimes, the real thing is better?

Cabaret Club Girls in Japan: All You Ever Wanted To Know

The usually in-depth and well-written website Neojaponisme had a very interesting article about the Cabaret Club girl boom in Japan that is a nice companion/supplementary piece to Hiroko Tabuchi-san’s excellent article. The adult entertainment industry in Japan is a fascinating thing—and this piece, Kyabajo Japan, does a very good analysis of the social and cultural phenomenon behind the Cabaret Club Girl As Celebrity and examines some of the better Japanese writings on the subject. The hostess clubs and cabaret clubs of Japan seem to be permanently embedded in the landscape of the Japanese night, although the use of the these places to “conduct business” or “entertain clients” seems to be declining and several DPJ politicians recently came under fire for trying to claim their expensive hostess club forays as political activities and expensing them with political funds. Well, we’ll save that digression for another time.  An excerpt from the Neojaponisme feature is below and the full article is on their website.

Cabaret Club girls are neo-celebrities in Japan, even putting out CDs
Cabaret Club girls are neo-celebrities in Japan, even putting out CDs

Continue reading Cabaret Club Girls in Japan: All You Ever Wanted To Know

"Human Trafficking and Sexual Exploitation in Japan. The New Victims: Japanese Teenagers"


Note: I’ve been working with the Polaris Project Japan, a non-profit organization that combats human trafficking and sexual exploitation of women and children, since 2005 and recently agreed to be their temporary public relations director.  In the last year, a lot of the calls coming to Polaris Project Japan were concerning Japanese teenage women who appeared to have been forced into the sex industry–not foreign women.  It does seem that the Japanese government has been enforcing the anti-human trafficking laws to the point where there are significantly fewer non-Japanese women being made sex-slaves. However, it seems they have been replaced by young Japanese teenage girls, many of them runaways or abused children. 

Polaris Project Japan had the brilliant idea of reaching out directly to these girls by making a mobile-phone web-site aimed at them, that was user friendly, and could offer some good advice.  Young schoolgirls don’t read newspapers, don’t watch as much television as they did, and most of their communications is over cell-phones and social networking sites. Unfortunately, such sites have also becoming prime hunting grounds for pimps, low-life yakuza, and pedophiles who seek out fresh meat to use themselves or sell to others. 


A mobile phone web-site aimed at helping Japanese teenage victims
A mobile phone web-site aimed at helping Japanese teenage victims

NHK, Japan’s answer to the BBC gave the website some good coverage this morning. 

The contents of the consultations that Polaris Project Japan and their partner organization Yukon have gotten are quite unpleasant. 


● From Host Club Patron To Forced Prostitution 

   A male Host asked a young victim come visit his club without worrying about money. After his begging continued, she went to the club a few times. Then, a different man from the club asked her for a few hundred thousand yen (a few thousand dollars) for the food and drinks she had consumed. She received threatening phone calls and was even ambushed at her own home. The men kept pressuring the girl to pay the bill, coercing her to go and work in the sex industry. Around that time, she was put in touch with Polaris, and after consulting with the police, she is safe once again.  

Note: I covered incidents like this one as far back as 2000, when I was still a police reporter assigned to the 4th district. It’s a classic technique that yakuza or general low-lives use to force young women into the sex trade.  Host clubs seems to be the equivalent of trafficking recruitment centers in many parts of Japan. 


● A 14-year-old farmed out as a prostitute by her classmates

 Her friends told her that she had a bad attitude, and forced her to apologize by paying money earned from prostitution. A few months later, through some website, she was introduced to a customer, and forced into prostitution. It had already been taken up as a case as a juvenile victim when she contacted this organization. She says, “I’m out of the situation, but I have nowhere to go. I always feel depressed.I let myself get picked up for casual sex, abuse my body, and start crying for no reason.” Polaris Project Japan provides  her regular counseling and the support she needs. 

  Anyway, these are some of the cases that have come up in the last year, there probably are a lot more.  Below is the press release for the web-site. The press conference was held April 1st (Japan time)  at the Foreign Correspondent’s Club of Japan. 




Polaris Project Japan Launches a New Mobile Website:

To help victims of child/teen prostitution

and child pornography and prevent further exploitation


The Polaris Project Japan (PPJ) is the Japanese branch of Polaris Project in Washington DC.  PPJ has been operating a hot-line for human trafficking victims for several years In the last year, PPJ has been receiving more and more calls not just from the traditional human trafficking victims–foreign women ensnared in the sex industry–but Japanese teenage girls who have been lured or forced into the sex industry and can’t get out, and sometimes even been asked by their own parents to work in the industry to make money for their family members. 


Contrary to the popular picture of Japanese teenage prostitutes as clueless teenagers who just want to earn money to buy a designer bag–many of the girls now in the industry are there because of financial necessity and a lack of support for abused girls and boys who run away from home. 

Many of these victims are recruited over the internet and or/are sold over social networking sites by their pimps–like commodities. 

The National Police Agency reported in 2008 internet Profile sites and Social networking sites are the hotbeds of child sex crimes, surpassing the net dating sites (which were originally the hub of sex trafficking).


It is hard to measure the extent of the problem because no Japanese government agency has attempted a comprehensive survey, and the laws protecting children are administrated by many different government agencies and ministries that do not share information or work together.


To provide an effective and systematical intervention to prevent sexual exploitation of adolescents and help victims, Polaris Project is launching a website:

¨       To provide an environment to seek counseling in a safe and anonymous way.

¨       To give information to questions like “What happens if….”, rather than sending simple “Stop” or “Danger” signs.

¨       To eliminate the embarrassment and fear of seeking counseling face to face by allowing contacts via website and phone.

¨       To inform the victims of additional channels of help available.


Polaris Project will also be working with The Children’s Human Rights Committee of the Japan Lawyer’s Association, Prefectural Women’s Centers, and Children’s Shelters to make sure that the children calling receive the best care and advice possible. It will also advertise on sites popular with Japanese youth to make sure the message reaches those who are most vulnerable.

About Polaris Project
Polaris Project is a non-profit organization that combats human trafficking and sexual exploitation of women and children. It was established in 2002 in Washington D.C., USA. In 2004, the Japan office was launched in Tokyo. Our activities and projects include victim outreach, multi-lingual hotline, victim support, and workshops for public and government agencies in positions of direct contact with victims.


Onions And Yakuza Front Companies: Some Thoughts

I’ve been reading the book, Black Money (ブラックマネー)by Suda Shinichiro, which is a fairly good description of Japan’s nearly 20,000,000,000,000 yen underground economy.  Yes, those figures are correct, by the way.

A good book about the Economic Yakuza (Keizai Yakuza)
A good book about the Economic Yakuza (Keizai Yakuza)

The yakuza invasion of Japan’s financial markets in recent years has been amazing and rapid.  Prime Minister Koizumi (who’s grandfather was a yakuza and a member of the Yokosuka-Ikka which was later absorbed into Inagawa-kai crime group) , under encouragement from the Bush administration and with the advice of Miyauchi, the chairman of the Orix group, instituted a widespread relaxation of previous laws and regulations of the finance industry which made it possible for organized crime to get their foot in the door, and once they got inside the House Of Commerce, they decided to stay.

The modern yakuza, or the 成人ヤクザ, make their real money in loan-sharking, stock manipulation, real-estate speculation, and IPOs. They need a veneer of legitimacy to do this and that is usually done by creating a dummy corporation—front companies.

One of the things I liked most about this book is the section where Suda discusses how the yakuza have changed over the years, and the very nature of the yakuza front company has changed as well.  Personally, I feel kind of nostalgic for the days when yakuza were idiots. They’d use their own gang offices as the company registration and put their own members on the board of directors. If you had a roster of yakuza names or a good database, it wasn’t hard to determine whether it was a front company or not.  Hell, you could to the office and watch the tattooed guys in bad suits come and go and pretty much figure it out instantly.

There is a very good book, long since out of print, by Mizoguchi Atsushi, called Yakuza Front Company.  I think it was issued around 1992, or 1991. I don’t have a copy with me right now. In that book, he gave a very credible explanation of why the Yamaguchi-gumi, the Wal-Mart of organized crime in Japan, holds such a large number of front companies. Back in the day, when the Yamaguchi-gumi had agreed to stay out of Tokyo, they weren’t able to open gang offices. However, front companies were a different thing. It allowed them to operate in Tokyo but not necessarily as “the Yamaguchi-gumi.”  In many ways, the front companies paved the way for the Yamaguchi-gumi invasion of Tokyo with the “merger” between the Yamaguchi-gumi and the Kokusuikai (国粋会)in November of 2005.

Well, anyway, things used to be a lot simpler when I was a cub reporter. The basics of yakuza operations were gambling, prostitution, extortion, violence, blackmail and shakedowns. They certainly have diversified over the years.  I’m having to read books on finance and forensic accounting to keep up.  If you don’t understand the stock markets in Japan, you can’t understand the modern yakuza.

Recently, I found a front company for a front company of a front company. In other words, it took me three layers of digging to find out the real company I was looking at and another layer to figure out which organized crime group was really running the show. It’s like peeling an onion and the onions keep getting bigger.

However, one yakuza boss did dispute my whining that yakuza money-earning activities (シノギ)had really changed in the last fifteen years.

“The yakuza started at gamblers (博徒). Gambling was always a source of great revenue for us, whether we received protection money from the bakuchiba (博打場・ばくちば=casino)operating on our turf, or whether we actually ran the bakuchiba ourselves.  Yakuza, the word itself, refers to a losing hand in Japanese gambling. And when we run the casinos, we always set it up so that the house wins more often and wins bigger. The Japanese stock market–all it really is a virtual bakuchiba, and it’s not hard to rig. Nowadays they call it ‘insider trading’ but it’s really just a crooked card game of sorts. 如何様の博打に過ぎない.  We have the capital to play the game and win every time. Monthly dues to the organization alone from lower ranking factions are tremendous revenue. The Osaka Stock Exchange–might as well be Caesar’s Palace for some of us. The difference is that we’re not ordinary customers and we already have our own dealers on the inside. How could we lose?”


Note: Koizumi’s grandfather was called “the tattooed minister” 刺青大臣。Former Prime Minister Koizumi’s local re-election campaign manager, Kiyoshi Takeuchi, was a long-time associate of the Inagawa-kai crime group and a former member of the group himself.

写真週刊誌『FRIDAY』(2004年6月25日号)は「小泉首相の選挙経歴 – 選挙対策本部長が元暴力団」というスクープ記事を掲載した。


初代会長 – 稲川聖城 二代目稲川会 昭和60年(1985年)10月、稲川聖城は、稲川会会長を五代目横須賀一家総長・石井隆匡に譲り、稲川会総裁に就任した。(石井隆匡は、平成2年(1990年)10月、病気により引退。)


Prostitution isn't just for Professionals anymore! How to find a high-paying job in Japan's Sex Industry.


In Japan, prostitution isn’t just for professionals anymore. The quasi-legal sex industry in Japan is estimated to be a multi-billion dollar market and all signs indicate that it continues to grow. In an otherwise stagnant economy, despite the efforts of the local police to contain it, the fast-food restaurant inspired fellatio-for-sale coffee shops (pink salons), the home delivery service sexual massage operations, and the S & M clubs and their like show no signs of disappearing. Continue reading Prostitution isn't just for Professionals anymore! How to find a high-paying job in Japan's Sex Industry.