Japanese mob pays respects to the boss who led the way to the top

September 06, 1991|By John E. Woodruff | John E. Woodruff,Tokyo Bureau of The Sun

IKEGAMI, Japan -- Japan's underworld -- the yakuza -- paid its respects yesterday to the boss Susumu Ishii, who led a generation of gangsters deep into the country's legitimate business establishment.

The burly men dressed like Western morticians came in Bentleys and Fleetwoods and Mercedes. Lots of policemen came, too. Someguarded, dressed in helmets, riot cloaks, carrying gray metal shields and black wooden clubs. Others hung by the media with their own cameras, hoping for mug shots of thugs.

Today they'll bury Susumu Ishii, but not his legacy.

His gang, the Inagawa-kai, penetrated the world's second-biggest economy so deeply that for most of this summer, the dying mob boss has been at the center of a string of scandals that have brought down the world's most pow

erful stockbrokers, threatened the careers of senior politicians and forced the Tokyo Stock Exchange to a virtual standstill.

Some Japanese writers styled Susumu Ishii's Inagawa-kai the "intellectual branch" of the yakuza, the gang that relies on brains more than guns.

The 67-year-old boss was credited with making the 1980s a decade of steady yakuza moves away from low life to high life as Inagawa-kai steadily expanded from its base of drugs and prostitution into stock and real estate speculation, eventually taking over a growing list of once-legitimate businesses.

Japan's easy-money "bubble economy" of the late 1980s made it easier. Japanese banks had become the world's most aggressive lenders, and speculation drove stock and real estate prices to astronomical heights that were limited only when the Bank of Japan deliberately ratcheted interest rates up in late 1989.

This summer, Japanese investigators have increasingly acknowledged that the Ishii style and strategy brilliantly took advantage of the Japanese business ethic of "long-term human relationships rather than laws."

Mr. Ishii's men, the investigators say, made an art of wielding the very secrecy of Japanese business life as a weapon against legitimate businessmen.

By last fall, when a brain hemorrhage compelled Mr. Ishii to retire, his reach extended across the Pacific to Hawaii and Nevada, where the state police are said to have long files on his associations with Japanese and U.S. real estate and recreation operations.

At the altar of the Main Gate Temple last night, a priest sat chanting in a red-and-gilt-lacquered chair, facing a portrait that showed Mr. Ishii as a white-haired man with penetrating eyes and a thin smile that seemed open to interpretation -- benign or threatening.

As column after column of big and petty hoods walked up and each solemnly added three pinches of incense grains to the burners, seven monks in gray robes and orange sashes knelt before the boss, reciting ancient chants for the soul of the dead to the throb of a drum.

They had much to thank him for.

Mr. Ishii's vision of a mob muscling into legitimate businesses opened up so much new action so fast that when the much larger Yamaguchi-gumi gang began to move in here from its Osaka base late in the 1980s, he decided to share Tokyo's part of the yakuza turf -- prostitution, drugs, labor rackets, extortion and gambling -- rather than shoot it out with the outsiders.

Some Japanese writers have stressed Mr. Ishii's benignly "intellectual" image. This is enhanced by the yakuza's claim to historic attachments to samurai warriors who became wandering "Robin Hood" figures after being dispossessed by the government in the 19th century.

A more sinister view arises from Home Affairs Minister Akira Fukida's contention that this summer's widely publicized cases only begin to measure how far the yakuza had penetrated Japanese financial life.

More than 70 percent of Japan's stock brokerage and other finance-related companies, and 50 percent of other companies listed on the Tokyo Stock Exchange, admitted last year that they had in some way acquiesced to demands from crime syndicates, Mr. Fukida told a parliamentary committee last week.

"Allowing anti-social groups such as crime syndicates access to money is in itself bad," Mr. Fukida said. "I think we should take legal measures to confiscate illegally gained profits."

His remarks were echoed by the National Police Agency, which has asked banks and securities companies to set up monitoring organizations in hope of driving gangsters out of their businesses.

Both industry organizations have agreed to comply, but Japanese newspapers quoted unnamed "banking and finance analysts" as saying they saw no hope that businessmen alone could cope with the spreading yakuza presence.

Police estimate that organized crime had revenues of about $11 billion last year, perhaps a fifth of it from activities involving businesses that appear legitimate or once were.

The Mainichi newspaper reported this summer that, besides some 29 million shares -- 2 percent of the total -- that his gang controlled in Tokyu Corp., Mr. Ishii was personally the recorded owner of a quarter of a billion dollars' worth of stocks in nine other companies, including Nippon Steel, Tokyo Gas, Nomura Securities and Ishikawajima-Harima Heavy Industries.

Learning from Mr. Ishii, the Osaka-based Yamaguchi-gumi, by far the biggest yakuza syndicate, moved in on a series of legitimate businesses, including Itoman Corporation, a real estate firm that has been drained of funds and left with billions of yen in debt to Sumitomo Bank, which has fallen into a leadership crisis over the relationship.

Police believe that when Mr. Ishii helped get Yoshinori Watanabe elected head of Yamaguchi-gumi in 1989, the Osaka-based gangster knew how to thank his Tokyo mentor, Japanese newspapers reported last month.

He gave him more than a million shares in Tokyu Corp.

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