Stop lending money to the yakuza, FSA tells Mizuho - ( J44P44NN )

Friday, September 27, 2013

The Financial Services Agency on Friday ordered Mizuho Bank to stop lending money to yakuza and said it appeared to be making little progress in addressing the problem.

Mizuho, one of the country’s biggest banks, has processed about ¥200 million worth of transactions for “anti-social forces,” a wide-ranging term Japan commonly uses to refer to mobsters.

The financial watchdog scolded the nation’s third-biggest bank for taking “no substantial steps” to deal with the issue after it was revealed two years ago and pointed to “serious problems” with its compliance monitoring.

Mizuho has a month to draft a plan to address the issue, the FSA said.

Mizuho said it “takes this order very seriously and deeply regrets these occurrences.”

It also issued a statement that said it “expresses its deepest and most sincere apologies to its clients and all related parties for any concern or inconvenience this may have caused.”

Like the Italian mafia or Chinese triads, the yakuza engage in activities ranging from gambling, drugs, and prostitution to loan sharking, protection rackets, white-collar crime and business conducted through front companies.

The gangs, which themselves are not illegal, have historically been tolerated by the authorities, although there are periodic clampdowns on some of their less savory activities.