An information processing firm in Tokyo assigned to process the personal data of around 5 million pensioners outsourced part of the task to a Chinese company — in violation of a contract that prohibited subcontracts, according to the Japan Pension Service.

The outsourcing fell under the spotlight after it was revealed that around 1.3 million people received lower pension benefits in February than they were entitled to as income tax breaks were not adequately reflected.

The pension management body, which has seen a series of incidents of mismanagement related to pension records, has been investigating whether the involvement of the Chinese firm caused the lower payments.