Police arrested Tsuyoshi Furusho, mayor of Saza, Nagasaki Prefecture, on Saturday in a bid-rigging case over a public works project in the town.
As part of the case, police also arrested Joji Yamaguchi, a 62-year-old company worker, and Eizo Kida, 53, a company executive and acquaintance of Yamaguchi.
The Nagasaki Prefectural Police department has not disclosed whether the three have admitted to the allegations.
Furusho, 77, was first elected mayor of the town in 2009. He is currently in his fourth term.
He is suspected of informing Yamaguchi of a price near the lowest acceptable bid and allowing Kida's construction firm to win the contract with a bid of ¥16.59 million.
With your current subscription plan you can comment on stories. However, before writing your first comment, please create a display name in the Profile section of your subscriber account page.