The arrest of a Liberal Democratic Party lawmaker on suspicion of accepting bribes from a Chinese gambling operator bidding for a casino resort project highlights the potential for corruption involving the lucrative business. The government says its policy of promoting casino resorts in this country — based on the 2018 law that paved the way for such establishments as yet another exemption from the nation’s gambling ban — will not be affected by the arrest of Tsukasa Akimoto. However, it needs to re-examine whether a system has been established to rule out any collusion in selecting the operators to run the casino projects.

Akimoto, who resigned from the LDP immediately after his arrest on Wednesday, was known as a key proponent of opening integrated resorts featuring casinos along with hotels, convention centers, entertainment and shopping complexes. Between 2017 and 2018 — when he is alleged to have received ¥3 million in cash and ¥700,000 in other benefits from the Chinese firm 500.com Ltd. — Akimoto was a senior deputy minister in the Cabinet Office in charge of the casino resort business while concurrently serving as deputy chief of the Land, Infrastructure, Transport and Tourism Ministry.

Prior to his arrest, Akimoto denied accepting inducements. Investigators reportedly suspect that he received the bribes from the Chinese company knowing that the money and benefits were meant to garner his favorable treatment in the firm’s bid for a casino resort project in the village of Rusutsu, Hokkaido. What he specifically did in return for the alleged bribes has not been made known and may have to wait for further investigations.

Behind the alleged bribery is the tightening competition among casino operators from overseas to enter the Japanese market, which was opened under the policy of Prime Minister Shinzo Abe’s administration to promote casino resorts as key projects to spur the economy after the Summer Olympic and Paralympic Games in Tokyo next year.

The government plans to set up a committee as early as next month to take charge of regulating the casino business in this country. After screening project applications by host local governments along with the prospective operators in 2021, the government is set to authorize up to three projects across the country. The overseas operators are competing with each other to be chosen by the host local governments. It must be made certain that the candidate sites and operators of the casino projects will be chosen in a fair manner free of back-door collusion. Currently, there are no regulations prohibiting contact between politicians or bureaucrats and the prospective resort operators.

Akimoto is reported to have become acquainted with the Chinese firm in question after he took part in a symposium about casino resorts in Naha, Okinawa Prefecture, in August 2017, just before he was tapped as deputy minister for the Cabinet Office. Four months later, the lawmaker visited the company’s head office in Shenzhen and met with its top executive. He is alleged to have met in April 2018 with officials of the firm at the tourism ministry in Tokyo, when the officials asked for his cooperation with the firm’s bid to enter the casino resort business in Japan. A senior official in the Rusutsu Municipal Government is also said to have been present at the meeting.

Japan has prohibited gambling by law except for publicly organized forms like horse racing, as well as pachinko parlors, which are categorized as belonging to the “gaming” business. The ban on casinos was lifted as the Abe administration pursued the casino resort business as a way to boost inbound tourism and revitalize the economies of host regions. Several local governments, including Yokohama as well as both the city and prefecture of Osaka, have announced bids to bring in casino resorts, counting on economic benefits touted to reach hundreds of billions of yen.

But aside from the concern that the already serious problem of gambling addiction could be exacerbated, the opening of casinos faces various challenges, including eliminating underworld involvement in their operation and preventing their use as fronts for laundering money. Given the arrest of the Lower House member over suspected bribery, eliminating corruption involving casino operators bidding for projects in Japan should also be on the agenda before the casino business is actually launched.