How Japan's worst gang, the Yakuza, switched to equity investing and disaster relief (2023)

Known informally as the Japanese Mafia, the Yakuza is a 400-year-old crime syndicate that engages in everything from human trafficking to real estate sales.

When news broke that the Yakuza were among the first to emerge after Japan's devastating Tōhoku earthquake and tsunami in 2011, it caused little sensation in the Western media, which tended to view the Yakuza as the Japanese mafia, more like John Gotti than like Jimmy Carter.

But this notion of the Yakuza gets it all wrong. The Yakuza was never just a few Japanese gangsters, or even a single criminal organization.

The Yakuza was, and remains today, something else entirely: a complex group of syndicates and the most powerful and misunderstood criminal gangs in the country.

And they are inexorably linked to 400 years of Japanese and Yakuza history. It turns out that the Yakuza is not what you think.

The Ninkyo Code and Humanitarian Aid

In the spring of 2011, Japan was devastated by one of the most brutal tsunamis and earthquakes in the country's history. The people of the Tōhoku region saw their homes destroyed, their neighborhoods destroyed, and everything they knew lost.

But then help came. A fleet of more than 70 trucksdumped in the towns and cities of Tōhoku, full of food, water, blankets and everything else the residents could hope to rebuild their lives.

But those first trucks didn't come from your government. The first relief teams to arrive, in many parts of Tōhoku, came from another group that most people don't associate with good works.

They were members of the Japanese Yakuza and it was not the only time in the history of the Yakuza that they came to the rescue.

After the 1995 Kobe earthquake, the Yakuza were alsofirst on the scene. And not long after their 2011 Tōhoku relief effort began to wind down, the Yakuza sent men to the deadly Fukushima nuclear reactor to help alleviate the situation resulting from the meltdown caused by the tsunami as well.

The Yakuza, a term that refers to both the various gangs and the members of those gangs, help out in times of crisis due to something called the "Ninkyo Code". It's a principle that all Yakuza claim to follow, one that forbids them from allowing anyone else to suffer.

At least that's what Manabu Miyazaki, author of more than 100 books on the Yakuza and minority groups, believes. He believes that the charitable arm of organized crime has its roots in Yakuza history.as it says, “Yakuza are the deserters of society. They have suffered and are just trying to help other people who are in trouble.”

The secret to understanding the Yakuza, Miyazaki believes, lies in their past, which dates back to the 17th century.

How the Yakuza began with Japan's social outcasts

The history of the Japanese Yakuza begins with the class. The first Yakuza were members of a social caste called the Burakumin. They were the lowest of the wretches of humanity, a social group so far below the rest of society that they were not allowed to touch other human beings.

The Burakumin were the executioners, butchers, gravediggers, and leather workers. These were the deathworkers, men who, in Buddhist and Shinto society, wereconsidered unclean.

The forced isolation of the Burakumin began in the 11th century, but it got much worse in the year 1603. In that year, formal laws were written to expel the Burakumin from society. Their children were uneducated and many of them were driven out of the cities and forced to live in isolated villages.

Today, things are not as different as we would like to think. There are still lists circulating in Japan that name all the descendants of a Burakumin and are used to prohibit them from certain jobs.

And to this day, the names on those lists still represent more than half of the Yakuza.

The children of the Burakumin had to find a way to survive despite the few options available. They could continue their parents' businesses, working with the dead and becoming increasingly isolated from society, or they could turn criminal.

So crime flourished after 1603. Stalls selling stolen goods began springing up all over Japan, most run by Burakumin's sons desperate to earn enough money to eat. Meanwhile, others set up illegal gambling houses in abandoned temples and shrines.

Soon, no one knows exactly when, hucksters and gamblers began to form their own organized gangs. The gangs would then stake out other street vendors' shops, keeping them safe in exchange for protection money. And in these groups the first Yakuza were born.

It was more than profitable. This earned them respect. The leaders of these gangs were officially recognized by the rulers of Japan, granting them the honor of family names and permission to bear swords.

At this point in Japanese and Yakuza history, this was deeply significant. This meant that these men received the same honors as the nobility. Ironically, turning to crime gave the Burakumin their first token of respect.

They weren't going to let it go.

Why the Yakuza is more than the Japanese mafia

It wasn't long before the Japanese Yakuza became a complete group of criminal organizations, with their own customs and codes. Members must observe strict codes of loyalty, silence, and obedience, codes that have endured throughout Yakuza history.

With those codes in place, the Yakuza was like a family. It was more than a gang. When a new member joined, she accepted his boss as his new parent. Over a ceremonial cup of sake, he would formally accept the Yakuza as his new home.

Loyalty to the Yakuza had to be complete. In some groups, a new Japanese gangster is expected to completely cut ties with his birth family.

However, for the men who joined these gangs, that was part of the appeal. They were social outcasts, people who had no connection to any part of society. The Yakuza, to them, meant finding family in the world, finding people to call brothers.

Tattoos and rituals of a Yakuza member

Part of what the loyalty of Japanese Yakuza members means is how they will change their own appearance. New members of the Yakuza covered themselves from head to toe with elaborate and intricate tattoos (in the traditional Japanese style known as irezumi), slowly and painfully etched into the body with a sharp piece of bamboo. Every part of the body would be marked.

Eventually, the Yakuza would be prohibited from showing their tattoo-covered skin. Even then, however, it was not difficult to identify a Japanese gangster. There was another way to find out: the missing finger of the left hand.

In Yakuza history, this was the standard punishment for disloyalty. Any Japanese gangster who disgraced the Yakuza name would be forced to cut off the tip of his left little finger and hand it over to his boss.

In the early days, it had a practical purpose. Each cut to a finger would weaken a man's grip on a sword. With each offense, the man's abilities as a warrior diminished, leading him to rely more and more on the group's protection.

A history with drug trafficking and sexual slavery

Historically, the Japanese Yakuza largely carried out what many would consider relatively minor crimes: drug trafficking, prostitution, and extortion.

The drug trade, in particular, turned out to be extremely important to the Yakuza. To this day, almost all of the illegal drugs in Japan are imported by the Yakuza.

Among the most popular is methamphetamine, but they also bring a steady stream of marijuana, MDMA, ketamine, and whatever else they think people will buy. drugs,as a yakuza boss said, are simply lucrative: "One sure way to make money is drugs: it's the one thing you can't get without a connection to the underworld."

But drugs aren't the only thing the Yakuza care about. They also traffic women. Yakuza agents travel to South America, Eastern Europe and the Philippines and lure young people to Japan by promising lucrative jobs and exciting careers.

However, when the girls get there, they discover that there is no work. Instead, they are stuck in a foreign country and without enough money to return home. All they have is the Japanese gangster they were set up with: a man who pushes them into a life of prostitution.

The brothels themselves are usually massage parlors, karaoke bars, or romantic hotels, usually owned by someone who is not part of the gang. He's his civilian front, a fake boss blackmailed into letting them use his business, and the guy who'll take the fall if the police call.

All of this is true today, as it has been for years. But none of that is what prompted the government to crack down on the Yakuza.

The crackdown came as the Yakuza turned to white collar crime.

How "Legitimate" Real Estate Got Started

Until recently, the Japanese Yakuza were at least somewhat tolerated. They were criminals, but they were useful, and sometimes even the government took advantage of their unique abilities.

The Japanese government asked them for help in military operations (although the details remain hazy), and in 1960, when President Eisenhower visited Japan, the government flanked him by dozens of Yakuza bodyguards.

While things like this made the Yakuza at least seem more legitimate, their code also prohibits members from stealing, even if, in practice, this rule wasn't always followed. However, many members throughout the Yakuza's history saw themselves simply as businessmen.

Real estate was one of the first major white-collar Yakuza scams. In the 1980s, the Yakuza began sending their enforcers to work for real estate agents.

They were called Jigeya. Real estate agents hired a Japanese gangster when they wanted to bulldoze a residential area and build a new development but couldn't get a small landowner to leave.

Jigeya's job was to get them out. They put nasty things in their mailboxes, scrawled obscene words on their walls, or, in at least one case, emptied the contents of an entire septic tank out the window.

Whatever it took to get someone to sell, the Yakuza would do it. They did the dirty work - and,according to Yakuza member Ryuma Suzuki, the government allowed them to do so.

“Without them, cities could not develop,” he said. “Large corporations don't want to get their hands dirty. They don't want to get in trouble. They expect other companies to do the dirty business first.”

Publicly, the Japanese government has washed its hands of it, but Suzuki may not be entirely wrong. More than once, the government itself has been caught hiring the Yakuza to evict people from their homes.

Yakuza enter the business world

After entering the real estate business, the Japanese Yakuza entered the world of business.

At first, the Yakuza's role in white-collar crime was primarily through something called Sōkaiya, their system for extorting business. They would buy enough shares in a company to send their men to shareholder meetings, and there they would terrorize and blackmail the companies into doing whatever they wanted.

And many companies invited the Yakuza to join. They came to the Yakuza asking for massive loans that no bank would offer them. In exchange, they would allow the Yakuza to take a controlling interest in a legitimate corporation.

The impact has been enormous. At its height, there were 50 companies listed on the Osaka Stock Exchange that had deep ties to organized crime. It was arguably the golden age of Yakuza history.

Legitimate businesses, the Yakuza quickly learned, were even more lucrative than crime. They began to set up a stock investment plan: they would pay homeless people for their IDs and then use them to invest in stocks.

They called their stock trading rooms "dealing rooms" and they were incredibly profitable. It was a whole new era, a whole new breed of crime for the Yakuza of the 1980s. As one Japanese gangster put it:

“I got arrested once for trying to shoot a guy. He would be crazy if he did that today. There is no need to take that kind of risk anymore,” he said. “I have a whole team behind me now: guys who used to be bankers and accountants, real estate specialists, business loan sharks, different types of finance.”

What's left of Yakuza

And as they delved deeper and deeper into the world of legitimate business, the Yakuza's days of violence were fading. Yakuza-related murders, one Japanese gangster killing another, have halved in just a few years. Now it was a white collar business, almost legal, and the government hated it more than anything.

The first so-called "anti-Yakuza" law was passed in 1991. It made it illegal for a Japanese gangster to engage in some types of legitimate business.

Since then, anti-Yakuza laws have piled up. Laws have been put in place that prohibit how they can move their money; Petitions were sent to other countries, asking to freeze Yakuza assets.

And it's working. Yakuza membership is reportedly at its lowest point in recent years, and it's not just due to arrests. For the first time, they are actually beginning to release gang members. With its assets at least partially frozen, the Yakuza simply doesn't have enough money to pay its members' salaries.

A criminal public relations campaign

All that pressure could be the real reason the Yakuza has gotten so generous.

The Yakuza has not always been involved in humanitarian efforts. Like the repressive measures of the police, their good deeds didn't really start until they became white collar crimes.

Journalist Tomohiko Suzuki disagrees with Manabu Miyazaki. He doesn't think the Yakuza are helping because they understand how hard it can be to feel left out. He thinks that's itgreat public relations stunt:

“The Yakuza are trying to position themselves to get contracts for their construction companies for the big rebuild that is coming up,” Suzuki said. "If they help citizens, it's hard for the police to say something bad."

Even as humanitarians, their methods aren't always completely honest. When they sent help to the Fukushima reactor, they didn't send their best men. They sent homeless people and people who owed them money.

They lied about what they would pay or threatened violence to help. As a man who was taken to work thereexplained:

“We do not receive any insurance for health risks, not even radiation meters. They treated us like it was nothing, like disposable people: they promised things and then they kicked us out when we received a massive dose of radiation.”

But the Yakuza insist they are just doing the best they can and honoring Yakuza history. They know what it's like to be abandoned, they say. They are just using what they have to make things better.

As one Japanese mafia member said: "Our sincere feeling now is to be of some use to people."

After this look at the Yakuza, the Japanese mafia, discover the great misunderstoodgeisha story. Then read about the terribletorture and murder of Junko Furuta, whose Yakuza connections to the main attacker helped him carry out the crime.