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Thursday, May 15, 2008

Denials start Chongryon property trial

Staff writer

A former chief of the Public Security Intelligence Agency pleaded not guilty Wednesday to charges of fraud, denying that he masterminded an investment scam to swindle the pro-Pyongyang group Chongryon out of the ownership of its Tokyo headquarters building.

In his first trial session, Shigetake Ogata, 73, told the Tokyo District Court that his proposal to purchase the building was an attempt to support the de facto embassy of North Koreans residing in Japan. He stressed that he fully intended to pay ¥3.5 billion in exchange for the rights.

"I sincerely apologize about the outcome," Ogata told the court regarding the failed deal, slamming prosecutors for pursuing criminal liability.

The prosecutor-turned-lawyer, who headed the security agency from 1993 to 1995, denied that he was aware funds for the purchase couldn't be arranged.

Ogata's alleged defrauding of Chongryon, or the General Association of Korean Residents in Japan, drew much media attention because the intelligence agency he once headed keeps the group under its surveillance. He was arrested last June and charged with fraud along with two accused accomplices.

Former real estate agent Tadao Mitsui, 74, and former bank official Koji Kawae, 43, were also arrested in connection with the case. Mitsui pleaded not guilty Wednesday in the same session. Kawae, whose trial began in February, has also denied the allegations.

Ogata and Mitsui are also charged with defrauding Chongryon out of ¥480 million while negotiating the ownership transfer. The prosecutors alleged during their opening statement Wednesday that the three conspired in April and May last year to take over the group's headquarters in Chiyoda Ward by registering as its owners.

The plot was to swindle the pro-Pyongyang group out of the ownership by assuring it of a ¥3.5 billion payment, although the three had no financial resources available, the prosecutors said.

Chongryon had a pressing need to sell its headquarters to investors because its properties were about to be seized due to its ¥62.7 billion debt to the government-backed Resolution and Collection Corp. Despite Kawae's failure to secure investors, Ogata and his accused accomplices allegedly misled Chongryon into believing the funds were available.

Harvest, Ogata's investment advisory firm, completed its registration as the owner of the building last May without making any payment. The rights were returned to Chongryon 10 days later, but RCC and Chongryon are in a legal battle to determine the process and rights to auctioning off the building.

The prosecutors said the trio tried to use the fame of the former chief of the intelligence agency to con Chongryon and use the earnings to expand their realtor business.

Meanwhile, Ogata, who in March made bail of ¥25 million, explained that he felt it crucial that North Koreans sustain their base in Japan. "My intentions were to avoid any interference of communication between North Koreans in Japan and their home country," he said, adding that protecting the group's headquarters would have also facilitated surveillance operations by the security agency.

Lawyers for Ogata and Mitsui stated that Chongryon was guaranteed its right to continue using the building even after the transactions, thus denying prosecutors' allegations that their clients attempted to take over the building.

The trial is expected to conclude next March with a ruling before summer 2009.

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The Japan Times

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