Japan's main opposition party challenged the government to investigate allegations of shady links between the ruling party and disgraced Internet entrepreneur Takafumi Horie yesterday, saying they would present concrete proof if a probe was launched.

But Prime Minister Junichiro Koizumi rejected the demand by Democratic Party leader Seiji Maehara, and the opposition chief was criticised by ruling party officials for not coming up with new evidence.

Koizumi's government has come under fire over the indictment of Horie, the former chief executive of Livedoor Co., on charges of violating securities regulations.

The ruling Liberal Democratic Party (LDP) had backed the 33-year-old IT entrepreneur as a poster boy for reform in his failed bid for a seat in parliament's lower house last September.

"From a variety of information, we are positive there was not only (campaign) support, but that money had changed hands," Maehara said in a one-on-one debate with Koizumi in parliament.

Last Thursday, Democratic Party lawmaker Hisayasu Nagata said that before the election, Horie had ordered Livedoor officials via e-mail to pay 30 million yen (US$252,500) in consulting fees to LDP Secretary General Tsutomu Takebe's son.

Takebe has repeatedly denied allegations of wrongdoing, and Koizumi has dismissed them as groundless, criticising Nagata for not producing evidence to back up his claims.

Japanese media have quoted unidentified senior Democratic Party lawmakers as saying hopes of proving the email was authentic were fading, and doubts have swirled over whether the Democrats can prove their case.

Fake or genuine?

Maehara said his party would not present additional proof such as the bank account number involved unless the ruling parties agreed to allow parliament to exercise its investigative powers, citing the possibility of a cover-up.

"If the matter is quashed, we would have no card left to play," he said.

Koizumi said the government was willing to consider allowing such a probe, but only if the opposition first presented concrete evidence.

"All you have to do is to show specific evidence and say that it is real and not fake," Koizumi said.

LDP officials chimed in, saying Maehara's failure to present new evidence in parliament cast further doubt on the authenticity of the e-mail.

"I think views that it is not genuine have strengthened," Chief Cabinet Secretary Shinzo Abe told a news conference.

Takebe expressed anger at the opposition's failure to present proof. "If they know the name of the bank and the name of the account, I can go there if they want," he told reporters.

"Why can't they do that? I feel indignation," he added.

If the allegation turns out to be true, it would likely deal a blow to the LDP and Koizumi, whose clout already appears to be fading as he enters his final months in office.

The maverick prime minister has said he will step down in September when his term as LDP president expires.

If the Democrats cannot prove their case, Maehara, who faces a party leadership election in September, would likely come under fire along with his struggling party, which took a beating in last September's election for parliament's lower house.

Legal action planned

Meanwhile, a group of about 50 lawyers started organizing a lawsuit against Livedoor on Tuesday to compensate shareholders who bought stocks at prices believed to have been hugely inflated by the Internet services company.

The group is seeking Livedoor shareholders as plaintiffs and will file a compensation suit possibly in September against Livedoor founder Takafumi Horie and other former executives. The company itself, as well as affiliate Livedoor Marketing Co. will also be named in the lawsuit, they said.

Horie, 33, and three other former executives were arrested in January on suspicion of spreading false information to investors to inflate the stock prices of Livedoor and Livedoor Marketing.

The lawyers said a substantial number of shareholders overpaid for the stock because of the false information disclosed to the market.

"Investors who had purchased stocks (in Livedoor) based on their belief in market fairness are the victims who should be compensated," said a spokesman for the group.

Source: China Daily