Best Denki ex-employee, 7 others arrested over postal discount abuse

Friday 17th April, 08:47 AM JST

OSAKA —

Prosecutors arrested a former senior employee of Best Denki Co and seven other people Thursday on suspicion of abusing a postal discount system for handicapped people to send advertising mail for the electronics discount store operator at much lower postal fees, the prosecutors said. The suspects were held on suspicion of violating the mail law by allegedly evading or helping evade mail charges, the prosecutors said.

Printing and mail order company Wellco Corp and advertising agency Shinsei Kigyo formed a tie-up and sent about 2 million pieces of Best Denki’s direct mail around February 2007 enclosing periodicals published by several groups for the disabled, the sources said.

Hakuhodo Erg Inc, a subsidiary of major advertising agency Hakuhodo Inc, is suspected of mediating between Wellco and Shinsei Kigyo in connection with the alleged arrangements, they said.

Under Japan Post’s mail discount scheme for handicapped people, mail charges are sharply discounted to around 8 yen each per mail item instead of the regular fee of 120 yen.

The companies concerned are suspected of taking advantage of the price differentials to save costs, the sources said.

Under the mail law, handicapped people and their supporters can send periodicals at a lower fee under certain conditions, such as when the periodical is issued three or more times every month and the periodical regularly has a circulation of 500 copies or more.

The Best Denki employee under arrest is Toshiharu Kubo, 51. The others arrested include Kazuyoshi Wakabayashi, 57, former chairman of Wellco; Akira Matsutani, 64, a former executive of Wellco; Nobuyuki Itagaki, 47, an executive officer of Hakuhodo Erg; Yoshikuni Morita, 69, chairman of a support group for handicapped people in Tokyo called Hakusan-kai; and Toshio Kikuta, 61, head of a handicapped people’s group called Kenko Forum.

Toshiyo Uda, 53, president of Osaka-based Shinsei Kigyo, and former Shisei Kigyo executive Toru Abe, 55, were served with fresh arrest warrants.

Prior to the arrest, investigators searched a number of locations that include Best Denki’s head office in Fukuoka, the Tokyo sales department of Wellco, a Japan Post outlet in Tokyo’s Koto Ward that handled the direct mail. Wellco is based in Hakusan, Ishikawa Prefecture.

The prosecutors are expected to look further into the case, in which other companies are highly likely to have been involved in sending more than 10 million pieces of direct mail by using an organization for supporting the handicapped that exists in name only.

In the midst of the prosecutors’ raid, Wellco announced Thursday that Wakabayashi stepped down Wednesday from the chairman’s post and that he also left the company’s board. Wakabayashi offered to resign, citing ‘‘personal reasons,’’ according to Wellco.

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Latest 15 of 17 Total Comments Show All

Den Den at 07:52 AM JST - 17th April

If proved, chain up their legs for a month and let them experience the everyday difficulties of handicapped people.
bobcatfish at 08:38 AM JST - 17th April

why should the handicapped get cheaper post in the first place?
Pukey2 at 09:17 AM JST - 17th April

Yes, smash their legs until they have the right to use the discount service!!!
ultradodgy at 09:18 AM JST - 17th April

"no proof has been proven"... ahh... right then.

Curious why the article is so focused on the individuals when this clearly involved corporate planning and corporate intent to defraud.
some14some at 09:38 AM JST - 17th April

Pretty small fraud involving Y200-300M... move on and don't wait for legal procedures.
herefornow at 09:59 AM JST - 17th April

Wow, Hakuhodo is dragged into this. That is much bigger news than some mid-size Osaka-based electronics firm trying to cheat. Who trusts Japanese electronics firms anyways? Having worked with Hakuhodo in the past, I know the kind of pressure their people are under to make their numbers. So this is not all that surprising.
mindovermatter at 10:33 AM JST - 17th April

What a waste of police resources.

How about about sending the company a bill for the actual costs plus interest...?

I guess that makes too sense...

This is why these bozo's fail 90% of the time when they are faced with REAL police work, because they are so busy BS stuff like this.
Wakarimasen at 12:29 PM JST - 17th April

Typical business morals. Poor handicapped people, having their privileges abused like this.
LFRAgain at 12:33 PM JST - 17th April

bobcatfish,

why should the handicapped get cheaper post in the first place?

As the article clearly points out, the discounted post is not for the handicapped per se, but for handicap-related periodicals, like news letters, for example. For everything else, handicapped citizens pay the same postal rates as the rest of us.

Don't worry - Those shifty handicapped bastards won't be pulling anything over on us "normal" folk.
BBLeo at 01:22 PM JST - 17th April

If anyone will get conviction for this than we are all aware that suspended sentence will be imposed on them. Why bother to do all the paper wok. Article is good and as others say, brake their leggs.
dennis0bauer at 03:14 PM JST - 17th April

change the name to bad denki co.?
LFRAgain at 04:12 PM JST - 17th April

Or how about So-So Denki?
neganip at 08:55 AM JST - 18th April

Its just a matter of time, real estate cost + personnel cost + warehousing + logistics all added to the cost of my lil digi camera. No make sense no moaaa no moaaa no moaaaa. Cartels of denkiyas = Jack !
cwhite at 12:11 AM JST - 19th April

not sure why handicapped get cheaper post... I'm sure plenty of handicapped people actually don't want to be treated any differently and some blind people don't even think of it as a handicap let alone a disability. Maybe they need to rethink this as in the next decade or so 50% or more of the elderly could be considered handicapped.
helloklitty at 05:15 PM JST - 19th April

I've got asthma. Can I get a discount?