Hokkaido Athletics Association’s Unpaid Dues and Embezzlement Scandal

The Hokkaido Track and Field Association, a general incorporated foundation, has been found to have failed to pay ¥7,352,500 in athlete registration fees to the Japan Association of Athletics Federations (JAAF) for the fiscal year 2022. Despite the passing of the fiscal year 2023, the payment has not been made. Additionally, it was revealed that Chairman Marunoboru resigned from his position midway through his term, and Vice Chairman Ryohei Itani was promoted to acting chairman from March 2nd, with administrative staff also being dismissed at the end of last year.

In the Report and Apology posted on the Hokkaido Track and Field Association’s website, apologies were made for the unpaid registration fees, improper expenditure of savings, and falsification of accounting documents, attributing the root cause to chronic deficit management and makeshift financial management. However, it has been reported that uncovering the actual situation has proven to be difficult.

Registration fees are not just membership fees; they are a necessary requirement for participating in track meets and are also applicable to middle and high school students, as stated in Article 8 of the JAAF Membership Regulations. The Hokkaido Track and Field Association failed to pay the ¥7,352,500 registration fees due for the fiscal year 2022 within the fiscal year and had been repeatedly urged by the JAAF to do so. Furthermore, in November of last year, JAAF Vice Chairman and IAAF Director Yuko Arimori, in an interview with FRIDAY Digital, expressed her hope that the Hokkaido Track and Field Association would make efforts to rebuild itself through self-help, stating, “If I were a child from Hokkaido, I would be angry,” and expressing the desire for them to understand that surrounding organizations will not easily come to their aid.

The Hokkaido Track and Field Association (Hokkaido TFA) stated that the reasons for the unpaid fees were due to the decrease in income caused by the COVID-19 pandemic, and the increase in expenses due to the relaxation of event restrictions in 2022 and the burden of related expenses from hosting the Inter-High School Championships, payments have been delayed. However, some stakeholders had suspicions about the possibility of embezzlement by administrative staff.

FRIDAY Digital obtained a document from the Hokkaido TFA’s board meeting held on March 2nd. At the bottom of the document, it is stated, “The contents of (1) to (10) above should not be disclosed until the formal interim report is released.” indicating that the document is highly confidential.

The section (4) Regarding the dissolution of the incorporated foundation in the document contains detailed information about the Hokkaido TFA’s financial situation.

Since the discovery of the unpaid fees, the Hokkaido TFA’s difficult financial situation has been widely discussed. If a general incorporated foundation’s net assets fall below ¥3 million for two consecutive fiscal years, it is required to dissolve (Article 202, Paragraph 2 of the Corporation Act), resulting in the dissolution of its legal entity. This is clearly stated in the document.

It is necessary to revise the financial statements before Reiwa 4th year, but with a situation where over ¥20 million has been lost, net assets of over ¥3 million have not been secured.

(Omitted) It will be impossible to maintain the incorporated foundation unless about ¥20 million of money comes in from sources other than borrowing.

Furthermore, one noteworthy point written in the document is regarding a potential solution.

(The possibility of maintaining the incorporated foundation) depends on whether the administrative staff repay the unaccounted funds or not.

In other words, if the Hokkaido TFA’s staff can repay the funds they improperly took out, they can secure net assets of over ¥3 million. Therefore, it can be interpreted that this is what the Hokkaido TFA is hoping for.

FRIDAY Digital’s investigation revealed that the employees of the Hokkaido Track and Field Association were dismissed by the end of December last year, following their report on the unpaid fee issue. While Masanari Watanabe, the executive director of the Hokkaido TFA, stated that “the dismissal of the administrative staff is not necessarily related to the unpaid registration fees” and it was not disciplinary dismissal, according to another source, the said employee has admitted their fault and expressed intention to repay, but the repayment has not been made yet. Facing significant losses and pushed to the brink of survival, the Hokkaido TFA might not hesitate to accuse and sue the said employee, as the situation warrants, but there are also opinions inclined towards settling the matter out of court.

In such a critical situation, the leaders in the field of Hokkaido, who are passionate about nurturing young athletes, do not conceal their frustration, stating, “The executives have lost their sense of responsibility.” They continue, 

“They are still delaying problem-solving, thinking that ‘it will somehow work out.’ There is absolutely no prospect of paying the unpaid registration fees, and they even go as far as saying ‘do not disclose’ when it comes to the possibility of dissolution.

It’s outrageous to settle without accusing the staff suspected of misappropriation privately. How will they explain to middle and high school students and their parents who are striving hard with dreams of participating in the Olympics or World Championships? We should deal with it decisively and promptly, with a sense of urgency, and disclose all information. If we don’t disclose, it’s a cover-up.” 

Criticizes sports writer Toshiki Tsuda, who is pursuing the investigation into the unpaid registration fees and inappropriate accounting practices of the Hokkaido TFA.

“The date on the obtained board report document reads ‘Year 5 of Reiwa,’ but officially it should be ‘Year 6 of Reiwa.’ Furthermore, in a different document than the one mentioned above, even though the disciplinary action against the administrative staff is disciplinary dismissal, it is written as disciplinary dismissal, which is used for public servants. Even in just one document, it’s sloppy, and the Hokkaido TFA lacks organizational integrity.

Some athletics stakeholders in Hokkaido have consulted the police about criminal charges against the administrative staff. If it’s true that executives of the Hokkaido TFA are proposing a settlement, they have no choice but to admit that it’s self-protection to avoid getting burned. Although the Japan Association of Athletics Federations (JAAF) says they will provide ‘maximum advice,’ we want them to take more proactive steps.”

While the JAAF has received a report of Chairman Maru’s resignation from the Hokkaido TFA, they claim they are not aware of the dismissal of administrative staff. Chairman Osagai of the JAAF reveals their stance on these developments.

“In order to ensure that the registered members of the athletics federation in Hokkaido (athletes and officials) can continue to engage in athletics with peace of mind, we will continue to demand prompt and appropriate responses from the Hokkaido TFA. Additionally, our association will strive to understand the situation and provide necessary support and cooperation.”

Among the registered members of the athletics federation in Hokkaido mentioned by Chairman Osagai is Masataro Jōyama, the Japanese record holder in the long jump, who is preparing for the Japanese Championships in June, which serve as the Olympic selection trials. Will he be able to calmly compete in the event? What necessary responses will the JAAF take? This situation is no longer just a concern for athletics stakeholders but is being watched by everyone.