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≡ TOKYO BID-RIGGING SCANDAL ≡
The iconic Japanese advertising agency Dentsu was fined ¥300 million (~$1.944 million U.S.) by the Tokyo District Court for its role in the test-event bid-rigging scandal with the Tokyo 2020 Olympic organizing committee.
Koji Hemmi, a former assistant director of the Dentsu sports division and one of the ringleaders of the bid-fixing project, received a sentence of two years in prison that was suspended for four years. Dentsu and Hemmi have both appealed.
The bid-rigging program has been a major stain on the Tokyo 2020 organizing committee and included a wide range of efforts:
● The one-time Deputy Executive Director of the Tokyo 2020 Games Operations Bureau, Yasuo Mori, and Hemmi were both arrested and charged with coordinating the bidding program for 26 test events for in 2018, which led to much larger contracts for venue management during the Tokyo Games.
The test-event contracts involved ¥538 million (about $3.95 million U.S.) and the Games venue management agreements were worth about ¥40 billion (about $293.6 million U.S.).
● Tokyo prosecutors, working in coordination with the Japan Fair Trade Commission, filed complaints against Dentsu, ad agencies Hakuhodo, Inc. and Tokyu Agency, Inc., and event management companies Cerespo Co., Fuji Creative Corporation and Same Two, Inc.
● In February 2023, Kyodo News reported that Dentsu Group President and chief executive Hiroshi Igarashi admitted to prosecutors that the company was responsible for rigging bids over contracts to plan and operate the pre-Games test events and then for venue management at the Tokyo Olympic Games.
Verdicts and fines have already been announced against Hakuhodo (¥200 million) and Cerespo Co. (¥280 million). Multiple individuals have been convicted; all have received suspended sentences and most are appealing.
Kyodo reported on Thursday, that “Presiding Judge Kenji Yasunaga said companies running the test events were told they would likely be commissioned to manage the Games and that Dentsu was aware of this.” Dentsu said, in a statement, “The decision differs significantly from our claims. We will reassert our justifications in the appeal and request that the ruling be rectified.”
Mori, the organizing committee “inside man” on the contracts, was sentenced last December to two years in prison, suspended for four years.
The bid-rigging scandal is separate, but much larger than the bribery-for-sponsorship program allegedly run by former Tokyo 2020 Executive Board member Haruyuki Takahashi, also a former Dentsu senior director. His trial is continuing.
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