Japan's trade minister returns money to firm

Japan's new trade and industry minister received contributions from a company in which foreign investors held a majority stake, but he was not aware of the possible violation of the political funding law at the time and has returned the money, an aide said on Monday.

It was the latest whiff of scandal for Prime Minister Shinzo Abe's cabinet and another blow for Yoichi Miyazawa, who has been in charge of the Ministry of Economy, Trade and Industry for less than a week but was already under fire for funding-related improprieties.

Last week, two ministers including Miyazawa's predecessor, Yuko Obuchi, quit over the accusations of the misuse of political funds. The justice minister also resigned over a separate possible infraction, although she denied any wrongdoing.

Miyazawa "did not have any idea at the time" that foreign investors had a majority stake in the company, the aide said, adding that the money, a total of 400,000 yen ($3,700) received in 2007 and '08, had been returned.

Japanese law prohibits politicians from accepting donations from foreigners or firms that are more than 50 percent owned by foreigners.

Seiji Maehara, who was foreign minister in an opposition Democratic Party-led government, resigned in 2011 for receiving political donations from a foreign national.

Speaking to reporters, Chief Cabinet Secretary Yoshihide Suga rejected suggestions that Miyazawa's problems were creating a headache for the government.

"He returned all the money immediately after realizing what happened. ... I think this is an appropriate way to deal with this situation," he said.

Ministers typically divest themselves of shares in companies they oversee before taking their posts. They are not allowed to buy or sell them after assuming their positions.

Miyazawa has said he would put the shares in a trust and that owning them would not affect his policies.