The chairman of the Financial Reconstruction Commission came under fire Thursday for recent remarks to financial executives that some have interpreted as indicating a willingness to intervene during government inspections. The nationwide inspections -- to be conducted by the Financial Supervisory Agency -- begin in July and run through March 2001. The Democratic Party of Japan demanded that Michio Ochi, also a Liberal Democratic Party member of the Lower House and a member of Prime Minister Keizo Obuchi's Cabinet, tender his resignation over the comments. A senior LDP lawmaker also said that Yoshiro Mori, the party's secretary general and head of an LDP faction to which Ochi belongs, is "taking the matter seriously," hinting that Ochi may have to step down. Chief Cabinet Secretary Mikio Aoki will meet with Ochi before this morning's Cabinet meeting to hear his explanation, government sources said. Ochi, meanwhile, defended his comment, saying that he did not mean to insinuate that he would use his authority to interfere in financial regulators' inspections of banks. Ochi's remarks were brought to the attention of politicians by Kiyoshi Ueda, a DPJ lawmaker, during the Lower House Finance Committee's session. In a tape recording of his speech that Ueda played for reporters, Ochi is heard to say, "Please inform us of any complaints about the inspection, if it's severe ... I will give it the utmost consideration if you make a written request to Mr. Hasumi and he passes it to me." The offer was made Saturday during a meeting in Shiobara, Tochigi Prefecture, that was organized by his LDP colleague, Susumu Hasumi, who represents the prefecture, and brought together 40 executives from local financial institutions. Ueda said it is obvious that Ochi was saying that he is ready to interfere in the FSA's inspections. "It a serious problem that could damage people's trust in financial inspections," he said. DPJ President Yukio Hatoyama also called for Ochi to resign immediately, calling his remark "a terrible slip of the tongue." "A minister like Ochi should quickly resign," the president of the largest opposition party said in a speech at a Tokyo hotel on Thursday night. Ochi himself said Thursday that he only meant to say that he wants to know how FSA inspections are being conducted. "The power over inspection rests with the FSA's chief and I don't even get reports about the outcome (of the inspections)," Ochi told reporters, saying that he would not interfere in somebody else's administrative jurisdiction.
