The Democratic Party of Japan will discipline Chiyomi Kobayashi since she has reneged on her decision to quit the Diet over a scandal involving ¥16 million in shady funds, Prime Minister Yukio Hatoyama said Tuesday.

Kobayashi, whose election office allegedly received illegal donations from the Hokkaido Teachers Union before last August's Lower House election, has denied any involvement in the misconduct.

Prosecutors have charged two people in connection with the funds, including a member of the union, but Kobayashi on Monday reneged on her pledge, announced March 16, to quit the Lower House. She also plans to stay in the DPJ.