‘In every trouble spot I have cautiously visited, there has always been one watering hole where, as if by secret rite, hacks, spies, aid workers and carpetbaggers converge.

John le carre

That observation by the British spy fiction master is one with which I wholeheartedly agree. And for me, that particular watering hole was the Foreign Correspondents’ Club in Hong Kong.

On the slightly humid Friday afternoon of November 9, 2012, I happened to be visiting Hong Kong and went to the main bar at the FCC in Central. The ceiling fan slowly rotated, and the television was showing CNN’s report of President Barack Obama’s re-election. Sipping a beer at the counter, I struck up a conversation with an American perched on a nearby stool. 

He was in his late sixties, spoke in a gentle manner, and seemed to have lived in Asia for many years. When I introduced myself as being from Japan, he casually said, holding his beer glass:

You remember the Lockheed scandal in your country, right? At that time, Deak & Company was the outfit that transported Lockheed’s money to Japan. And I worked for Deak, smuggling cash into Tokyo.

That was my first encounter with Bruce Aitken, one of the world’s most successful money launderers, who transported bribes for former Prime Minister Kakuei Tanaka and other government officials in the Lockheed scandal.

In February 1976, the U.S. Senate Subcommittee on Multinational Corporations, chaired by Senator Frank Church, under the Foreign Relations Committee, revealed that Lockheed Aircraft Corporation had channeled over three billion yen in secret funds to sell planes to Japan.

It was revealed that bribes were distributed to high-ranking Japanese government officials and right-wing fixer Yoshio Kodama to sell the Lockheed TriStar (L-1011) passenger jet to All Nippon Airways. 

It was further revealed that Marubeni, a major trading company representing Lockheed sales, issued receipts for these illegal funds using the code name “Peanuts.” At a Church Committee meeting, Lockheed’s vice chairman, A. Carl Kotchian, testified that approximately 600 million yen had been transferred to several high-ranking government officials via Marubeni.

In July of the same year, the Tokyo District Public Prosecutors Office arrested Tanaka on suspicion of receiving payoffs. Lockheed’s treasurer and Tanaka’s driver committed suicide.

Given its scale and the diverse cast of characters, Lockheed truly warrants the title of the greatest scandal of postwar Japan. And in this case, the American foreign exchange dealer Deak & Co. played the role of an underground bank.

Money sent from Lockheed’s headquarters in California was transferred to Deak & Co. through a subsidiary. Deak & Co. operated a branch in Hong Kong, where Japanese yen prepared locally was smuggled into Tokyo. The system used double and triple layers of cushioning to erase any connection to Lockheed. 

Aitken, the American who transported the funds for this operation, was born in 1945 in New Jersey. He loved baseball from a young age and during his college years in Florida even aspired to become a professional player. However, a knee injury forced him to abandon that ambition.

In 1969, a disheartened Aitken happened to read a newspaper article about a subsidiary of American Express, advertising for a position in Vietnam. He applied. At the time, the Vietnam War was in full swing, with the United States deploying over half a million troops. Aitken was posted to US military facilities in Saigon and elsewhere, where he handled deposit and foreign exchange operations.

In 1972, Aitken moved to Deak & Company. The founder and president, Nicholas Deak, was Hungarian-born and had established the company in New York in the 1930s. During World War II, he served in the U.S. Army and was assigned to the OSS (Office of Strategic Services, a predecessor of the CIA). After the war, he returned to business and became one of the leading foreign exchange brokers in the United States. He was called by some “the James Bond of the world of money.”

Aitken’s first assignment for Deak was on Guam in the Western Pacific. The following year, in 1973, he received an urgent phone call from the Hong Kong branch manager.

“He ordered me, ‘Come here immediately,’ so I rushed over, and was told, ‘Go to Japan. There’s a lot of urgent business with Japanese yen payment orders piling up.'”

Aitken immediately returned to Guam and, at the branch in Agana, Guam’s capital city, he began filling a golf bag with cash late at night. Using a screwdriver, he removed the rivets at the bottom of the bag, revealing a compartment for banknotes. This was where he would stuff 100-million-yen worth of 10,000-yen banknotes. He then headed straight to the airport and checked in for a Japan Airlines flight to Tokyo’s Haneda Airport. 

Later, Aitken, reviewing company records, learned the order came from Lockheed, and the contact person was a senior official of Lockheed’s Tokyo office.

“One hundred million yen in cash is quite heavy,” he told me. “That was the maximum amount I could carry hidden in a golf bag. Also, while most golf bags can accommodate 10 or more clubs, ours only held three. To keep the weight down.”

And so, he repeatedly flew into Tokyo carrying this golf bag. Nowadays, he would almost certainly be intercepted by airport X-ray screening. 

The smuggled money was not handed directly to Lockheed’s representatives. When delivering cash to clients, Deak always utilized multiple local agents. One was a foreign priest who had lived in Japan for many years. Aitken met the priest at a Spanish restaurant in Tokyo and handed him a shoulder bag containing the cash.

What’s crucial here is the timing of the Hong Kong branch manager’s instruction to smuggle the cash. In the summer of 1972, Lockheed’s Kotchian stayed in Tokyo for over two months, taking the lead in promoting the TriStar aircraft. In October, All Nippon Airways (ANA) made the decision to purchase them.

The following year, Lockheed received an international phone call from Marubeni’s managing director, Toshiharu Okubo. Kotchian later stated this in his memoir:

Mr. Okubo suddenly said, “Now is the time to fulfill that pledge (promise).” For a moment, I wondered what he meant. But then I realized that Mr. Okubo had used the English word “pledge,” and I understood he was referring to the “500 million yen” for Prime Minister Tanaka’s office that was promised the previous August.”

About three days later, Mr. Okubo called again. “That matter is extremely important, and I absolutely need you to fulfill your pledge.” Mr. Okubo’s tone was very serious and tense.

Ultimately, Kotchian arranged the budget at headquarters and instructed the accounting department to transfer the money, which was the money Aitken had carried in his golf bag. However, according to Aitken, Deak & Co. was not informed that the money would be used for bribes in Japan.

Another important question is why the cash was transported from Guam, and how hundreds of millions of yen happened to be on the island. When asked this, Aitken replied as if it were perfectly natural.

“Back then, Guam was a popular destination for Japanese honeymooners. Every day, planeloads of newlywed couples from Japan would arrive. They would bring Japanese yen, which they exchanged at their hotel. We bought the yen from the hotels and as a result, we ended up with a lot of Japanese yen.”

So, it seems the bribes that wound up in the pockets of former Prime Minister Tanaka, the right-wing fixer and other government officials ultimately originated from money exchanged by Japanese newlyweds.

Eventually, in January 1978, Aitken became independent and founded First Financial Services. However, his work remained in cash smuggling, and his clients were famous drug dealers. His business continued to grow steadily until his fate took a dark turn.

In 1989 he was arrested in Thailand by US authorities pursuing drug trafficking connections. Repatriated to the US, Aitken faced charges of money laundering, and could have faced life imprisonment. Desperate for an out, he consulted with lawyers and investigators in prison and proposed a plea bargain to the prosecutors, offering to share what he knew about the Lockheed scandal in exchange for a lighter sentence. The prosecution’s initial response was reportedly not favorable.

“They said it was ancient history,” said Aitken. “They just wanted to keep me in prison for a long time. But then they apparently contacted other departments in the US government, probably the State Department and intelligence agencies. Then, within a week or so, I got a response. My information must have hit a nerve. Negotiations began, and my 20-year sentence was reduced to eight years, and finally to 10 months. So, the Lockheed scandal saved my life.”

It’s unclear exactly what discussions took place within the US government at that time. However, according to Aitken, the information he provided included payments in Japan, as well as large sums of US dollars to a high-ranking South Korean military official. It’s likely these were related to sales of military aircraft.

You can imagine the panic at the State Department and CIA when they learned this. The man they thought was just part of a drug trafficking ring was involved with Deak, and specifically, the Lockheed scandal. If he were to stand trial and confess to illegal activities in Japan and South Korea, a disaster, perhaps even an international incident, might ensue. It probably was deemed better to release Aitken and have him stay out of trouble. 

Tanaka was arrested and convicted in the Lockheed scandal, but Bruce Aitken, bagman for the bribes, was released from prison thanks to the same scandal. It’s nothing short of a historical irony.

Aitken still lives in Hong Kong with his family. This year marks exactly 50 years since the Lockheed scandal, and he tells me he wants to visit Japan again. I wonder whether he’ll carry his golf bag this time.  

Eiichiro Tokumoto is a writer living in Tokyo.

This article was originally published by Number 1 Shimbun, the magazine of the Foreign Correspondents’ Club of Japan. It is republished with permission.