The Flow of Money — Show Business, Construction, Finance

Last time, we watched the process by which, in the 1960s, the violent gangs swelled from local groups into nationwide organizations. But for organizations of this scale to operate, money is naturally required. So from where, and along what routes, did that money come in? In this installment, we read, as economic structure, several of the mechanisms long said to be sources of funds for the violent gangs. Entertainment promotion, the brokering of construction sites, finance and the collection of debts, the sokaiya who dealt with companies, and the mikajimeryo levy of the entertainment districts. What these have in common is that many of them straddle the boundary between the legal and the illegal. Let it be said in advance: there is no intent here to explain the methods in detail. Rather, what we wish to see is the burden and the harm these mechanisms have imposed on society—seen from the side of the victims.

The Mechanism Called Mikajimeryo — Seen from the Side That Is Made to Pay

One of the longest-known sources of funds for the violent gangs is the ‘mikajimeryo’ levy. According to the explanations in encyclopedias and police materials, this refers to making those who run restaurants and various businesses within an area treated as a turf pay money and goods on a regular basis, under names such as ‘compensation for permitting’ that business. Terms like protection money or bodyguard fee were also used. Police materials note that, in the postwar period, such practices became commonplace.

What matters here is not to take this mechanism as something like ‘a fee in exchange for keeping order.’ In reality it was a demand backed by violence and intimidation—if you did not pay, it became hard to continue your business—and for those running shops it was a burden hard to escape. The more honestly people worked in a community, the more that weight was loaded onto them. Under the later Anti–Violent Gang Law, a mechanism was put in place by which the administration could order a halt to such demands made by members of designated organizations, and at present, in many local ordinances, penalties are said to reach even the side that pays. This shows that the mikajimeryo levy has been repositioned, from a ‘tolerable practice’ into a mechanism that ought to be severed.

Show Business, Construction, Finance — Clinging to the Legal Economy

Whereas the mikajimeryo levy was an old source of funds with roots sunk into the entertainment districts, what grew in weight along with the organizations’ expansion was a form of fund-raising that wedged itself deep into legitimate business activity. Police materials record that the fund-raising activities of the violent gangs changed with the times.

Take, for example, the promotion of entertainment and music. Running performances and events involves much arrangement—venues, the marshaling of people, the handling of tickets. It has been pointed out that there were movements to become involved in such sites and to profit through control and brokering. In the field of construction too, it has been reported that there were cases of intervening in the arranging of labor and in scenes of development and land preparation, seeking to obtain substantial sums. In finance, lending at high interest, and the collection of soured debts—so-called debt recovery and intervention in civil matters—have been regarded as sources of funds.

What these have in common is that, rather than the violent gangs themselves creating new value, the structure is one of clinging to already-existing legal economic activity and siphoning off a part of its flow. On the surface they wore the face of regular transactions or businesses, while behind it lurked intimidation and illegal demands. This domain, where the boundary between the legal and the illegal easily blurs, was precisely the place where the underworld long survived. That is why the later efforts to exclude violent gangs would head in the direction of shutting them out from contracts and transactions themselves—of blocking the entrance to the economy (Episode 8).

The Sokaiya — A Shadow Parasitic on Companies

On the point of being between the legal and the illegal, there is one more thing to look at: the ‘sokaiya.’ According to encyclopedia explanations, this refers to those who hold shares to stand in the position of a shareholder, and who try to extract money and goods from companies by dangling, for instance, the threat of remarks at the shareholders’ meeting. Those who carried out such activities against companies had existed from long ago, but police materials note that, from the late 1950s into the 1960s, violent gangs that strengthened their ties with such figures became conspicuous.

What made the sokaiya a problem was that the shareholders’ meeting—a public arena that is supposed to bear the decision-making of a company—was turned into a tool of intimidation and bargaining. Companies, too, are said to have easily fallen into the relationship of handing over money in order to avoid the meeting being thrown into disorder. Against such a composition, in 1981 the Commercial Code was revised, and a provision is said to have been established to punish a company for granting benefits in connection with the exercise of shareholders’ rights. According to reports, after this revision, incidents emerged in which the crime of granting benefits was applied, and the opaque relationship between companies and sokaiya came to be called into question. Even so, in some quarters connections beneath the surface are reported to have continued, and the attempt to sever the underworld from corporate society took a long time.

Looked at this way, the flow of money of the violent gangs emerges not as flashy crime, but as a structure that quietly clung to society’s economic activity and exploited the blurriness of its boundaries. And this structure rested upon the burdens of the people who were harmed—those who ran shops, those who worked at companies, those who were their trading partners. The swollen organizations, holding such money within them, would in time repeatedly stir up confrontations that greatly shook society. Next time, we look from the side of the victims at the turning point when violence summoned the fear of citizens and the gaze upon the underworld grew severe.