Recruit scandal

Quick Facts: Who was Recruit scandal?

Subject:

Recruit scandal

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Major Japanese insider trading and corruption scandal involving politicians and business leaders.

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2Day Chrono-Wiki & Primary Historical Archives

Origins & Early Life

The Recruit scandal (Japanese: リクルート事件, Hepburn: Rikurūto jiken) was an insider trading and corruption scandal that forced many prominent Japanese politicians to resign in 1988. Recruit is a human resources and classifieds company based in Tokyo. Its chairman, Hiromasa Ezoe, offered a number of shares in a Recruit subsidiary, Cosmos, to business leaders and senior politicians shortly before Cosmos went public in 1986. Following the public offering, Cosmos's share price skyrocketed, and the individuals involved in the scheme saw average profits of ¥66 million each.

Pivotal Works & Achievements

Although only seventeen members of the Diet were involved in the insider trading, another thirty were later found to have received special favors from Recruit. Among the politicians involved in the scandal were Prime Minister Noboru Takeshita, former Prime Minister Yasuhiro Nakasone, and Chief Cabinet Secretary Takao Fujinami. In addition to members of the LDP government, leaders of the Komeito, Democratic Party of Japan, and Japan Socialist Party were also found to be involved. As a result, Takeshita's cabinet was forced to resign, although some of its members returned to political prominence later (including future prime ministers Kiichi Miyazawa and Keizō Obuchi).

Enduring Legacy & Impact

The chairmen of NTT, the Yomiuri Shimbun, and the Nihon Keizai Shimbun were also involved in the scandal. Despite the breadth of the Recruit scandal across party lines, the LDP was hurt most significantly by the scandal. It is often said to be one of the main causes of Morihiro Hosokawa's opposition party victory in 1993, which briefly interrupted the LDP's otherwise continuous reign over Japan.

Chronological Milestones & Life Events

1. 1986: 1986 Milestone — Its chairman, Hiromasa Ezoe, offered a number of shares in a Recruit subsidiary, Cosmos, to business leaders and senior politicians shortly before Cosmos went public in 1986.
2. 1988: 1988 Milestone — The Recruit scandal (Japanese: リクルート事件, Hepburn: Rikurūto jiken) was an insider trading and corruption scandal that forced many prominent Japanese politicians to resign in 1988.
3. 1993: 1993 Milestone — It is often said to be one of the main causes of Morihiro Hosokawa's opposition party victory in 1993, which briefly interrupted the LDP's otherwise continuous reign over Japan.

Historical Fact-Check Quiz: Recruit scandal

True or False: “The Recruit scandal was solely limited to members of the Liberal Democratic Party (LDP).”

Answer (FALSE ❌): While the LDP was significantly affected, leaders from other parties like Komeito, the Democratic Party of Japan, and the Japan Socialist Party were also found to be involved.

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Frequently Asked Questions about Recruit scandal