The embattled head of an Osaka school operator at the center of a murky real estate deal gave sworn testimony in the Diet on Thursday that he received a ¥1 million donation in Prime Minister Shinzo Abe’s name to help fund a nationalist elementary school he was building.

In the nationally televised appearance, Yasunori Kagoike, head of Moritomo Gakuen, gave testimony in both chambers of the Diet to shed light on his alleged ties with Abe and his wife, Akie.

Kagoike repeated claims that he accepted an envelope containing ¥1 million in cash from Akie Abe on Sept. 5, 2015, when she was invited to deliver a speech at Moritomo’s Tsukamoto Kindergarten. Kagoike testified under oath, meaning any attempt to falsify his statements could bring perjury charges.

Such a donation is not illegal, but it would link Abe to Kagoike, who critics describe as an advocate of ultra-nationalist views.

That would be an unwelcome revelation for Abe, whose so-far invincible administration has taken a hit in the opinion polls.

According to a Yomiuri Shimbun survey last week, Abe’s approval rate has plunged 10 points to 56 percent due apparently to growing misgivings about the scandal.

Later in the day, Chief Cabinet Secretary Yoshihide Suga flatly denied Kagoike’s allegations, saying the two government officials who accompanied Akie on her visit to the school both denied that Kagoike and the first lady ever met one-on-one.

“Just before she gave the speech, she and I had a brief chat in my office, alone,” Kagoike recounted. “She then took out the envelope from her purse and gave it to me. I asked, ‘Are you sure?’ and she said, ‘It’s from Shinzo Abe.’ “

“It was such a great honor for me that I have a very clear recollection of the exchange,” he said.

On Thursday night, Akie Abe broke her silence to deny Kagoike’s allegation on her Facebook page, adamant that she never handed him the donation.

Kagoike also alleged that in October 2015 he sought Akie Abe’s influence in extending a 10-year lease for a plot of land that he later purchased to build the elementary school, Mizuho no Kuni.

In October the same year, he said he left a message on her phone asking for help. Her secretary Saeko Tani, who eventually replied via fax, said that despite efforts to negotiate with the Finance Ministry, they couldn’t get the deal he had hoped for.

If Kagoike’s allegation is true, it would contradict Shinzo Abe’s denial that either he or his wife were involved in the negotiations between Moritomo Gakuen and the Finance Ministry, opposition lawmakers argued.

“If the secretary of the first lady made inquiries with the ministry on your behalf, that’s a huge deal,” said lawmaker Tetsuro Fukuyama of the Democratic Party.

On Feb. 17, Shinzo Abe told the Diet he would quit as prime minister and a lawmaker if either he or his wife were found to have “engaged in” any activities to help Moritomo Gakuen with the land deal. At the news conference, Suga said the fax was sent to one of Akie Abe’s assistants, and that the assistant, not his wife, made an inquiry to the Finance Ministry.

The fax also showed that the ministry turned down all requests from Kagoike to get more favorable conditions for the lease, Suga said, handing out copies of the fax to the media.

But during the Diet session, Kagoike said he asked Akie Abe to help, not the assistant.

To buy the plot in Toyonaka, Osaka Prefecture, Moritomo Gakuen paid only ¥134 million even though a land appraiser estimated its value at ¥956 million. The scandal raised the possibility of influence-peddling, igniting speculation that the deal was manipulated by politicians with cozy ties to Kagoike.

Later in the day, Kagoike explained at the Foreign Correspondents’ Club of Japan that being able to use Akie Abe’s name somehow worked to his advantage and gave “great momentum” to his effort to get a big discount on the land.

The principal, however, emphasized that he didn’t think the prime minister himself exerted direct influence to make the deal possible. Instead, Kagoike said he was rather inclined to believe that it was the bureaucrats at the Finance Ministry who pulled the strings behind the scenes.

A kindergarten run by Moritomo Gakuen is known for instructing pupils to recite a 19th century Imperial creed on patriotism and idolize Abe as a hero who defends Japan against hostilities from its Asian neighbors.

The school also recently came under fire for handing out to parents copies of what was widely decried as a racist statement accusing Koreanand Chinese residents of “possessing wicked thoughts.”

Kagoike also claimed he gave Akie Abe ¥100,000 as a token of his appreciation for her 2015 speech, with the word kansha (gratitude) written on the envelope. This also contradicts a remark made by Abe, who had earlier said in the Diet that his wife received no such remuneration.

Akie Abe denied the remuneration claim on her Facebook post.

Kagoike also said that in a recent email exchange with his wife, Junko, Akie Abe urged her to keep quiet about her “involvement.”

“It almost sounded like the first lady was trying to seal our lips,” Kagoike said.

Thursday’s session saw lawmakers from various parties take turns grilling Kagoike.

While Kagoike sought to emphasize his relationship with Akie Abe, members of the Liberal Democratic Party-Komeito ruling coalition tried to cast doubt on his account.

Toshiko Takeya from Komeito, for one, said that Tsukamoto Kindergarten’s website boasted that the Emperor paid a visit to the institution, when in fact there was no such visit.

Kagoike said he was unaware of any mention of the Emperor’s trip on the website and said he would apologize if there was any such description.

At the FCCJ news conference, Kagoike didn’t hesitate at all to justify the nationalist curriculum at Tsukamoto Kindergarten. He said children need to be taught a “correct” view of Japanese history early on, emphasizing Japan’s ongoing territorial disputes with China and South Korea.

“Territorial issues are very important. Those territories can easily be invaded unless we stake a claim to them,” he said.

“The Japanese are a very kind people, but children must recognize what is wrong at an early age,” he said. “Otherwise, they can’t make a correct judgment when they grow up.”

With Tuesday’s revelations, the scandal looks set to pick up steam as opposition parties attempt to confirm Kagoike’s claims and increase pressure on Abe to summon those in Osaka named, including Matsui, other members of his party and Osaka bureaucrats involved with Moritomo, to appear before the Diet.

In addition, there are calls in Osaka and elsewhere to have the prime minister’s wife, Akie, testify about Kagoike’s statement that he personally received a ¥1 million donation from her in an envelope. Kagoike indicated to the Foreign Correspondents’ Club of Japan on Thursday evening that other employees at the school knew about the donation, which the prime minister has denied and about which his wife had said she has no recollection.

On her Facebook page Thursday night, however, she issued a clear denial of Kagoike’s statement.

In sworn testimony to the Upper House, Kagoike blamed Matsui for Moritomo’s rejected application to open a new school, despite earlier signs from bureaucrats that the application was sufficient to meet their requirements.

Fraud allegations forced Kagoike to withdraw the application earlier this month and abandon the plan to open to the school.

The allegations center on revelations that Kagoike provided conflicting estimates for construction costs as well as questions about how Moritomo was able to purchase land valued at ¥956 million for ¥134 million. “We were 99 percent ready to go (with the opening), when Matsui pulled the ladder out from under me,” Kagoike said.

“Kagoike-san, perhaps you have a grudge against me because I pulled the ladder away,” Matsui replied via Twitter. “But it’s natural to do a review of the application process if the application is found to be thick with false statements.”

The three different construction estimates were submitted to different entities. Kagoike told the central government the cost would be around ¥2.3 billion. But he told the prefectural government it would cost only ¥756 million. To Kansai Airports, the operator of Itami airport, which managed the plot, the estimate was ¥1.5 billion.

In addition, Kagoike said he asked for unspecified cooperation from Osaka-based Liberal Democratic Party member Takuji Yanagimoto, who chairs an Upper House committee on constitutional reform, and Issei Kitagawa, a former deputy transport minister in the chamber who retired last year.

Kagoike also said he contacted Nippon Ishin Upper House member Toru Azuma for assistance. At a Thursday afternoon news conference, however, Azuma denied he did anything for Kagoike.

“I met Kagoike once when I was a member of the prefectural assembly, about five years ago, but that doesn’t mean I did anything unfair. I heard he had a plan to open a new elementary school, and that the prefectural rules regarding the establishment of private schools were strict. But I didn’t know the details or what kind of school it was. I was never asked to do anything on Kagoike’s behalf,” Azuma said.

There are now calls to summon Matsui to provide testimony on the prefecture’s role in the scandal, as well as past officials from the Kinki Regional Finance Bureau in selling the land at a huge discount. Matsui has indicated he would be willing to testify if called.

Also Thursday, Eiichi Kajita, head of the Osaka Prefectural Government’s private school division, provided unsworn testimony to the prefectural assembly, saying the original decision to approve the school with certain conditions was unprecedented. He added that it came with the understanding that the Finance Ministry had completed the land purchase with Moritomo Gakuen.

Yasunori Kagoike, head of Osaka-based Moritomo Gakuen, alleged in Diet testimony that the name of first lady Akie Abe may have been instrumental in making a cut-price land deal possible and repeated claims that she donated ¥1 million in person to the school in the prime minister’s name.

On Friday, Abe took advantage of an appearance before the Upper House Budget Committee to deny the allegations.

“It is extremely regrettable that he made these factually erroneous accusations based on a closed-door exchange between him and my wife that there is no way to prove otherwise,” Abe said in his first official response to Kagoike’s sworn testimony.

“I’d like to emphasize that neither she nor I are in any way involved in the purchase of land for the school and the municipal certification of the institution.”

Kagoike, whose schools are known for adhering to an ultra-nationalist curriculum and who has been probed over allegations of hate speech, also accused the first lady of trying to “silence” him in a bid to hide her involvement in the building of an elementary school at the center of a sweetheart land deal.

The Democratic Party, the Japanese Communist Party, the Liberal Party and the Social Democratic Party jointly demanded Friday that the first lady be summoned to the Diet as a sworn witness, but the proposal was rejected by Abe’s ruling Liberal Democratic Party.

It remains unclear how much damage the unfolding scandal will cause for Abe’s seemingly invincible administration.

An opinion poll published last week by the conservative Yomiuri Shimbun newspaper showed the approval rate for his Cabinet stood at a still-solid 56 percent. But it also pointed to a 10-point plunge in popularity from the previous month — the biggest monthly fall since Abe returned to power in December 2012.

On Friday, Abe disclosed excerpts of an email between Akie Abe and Kagoike’s wife, Junko, that the leader said had been taken out of context during Kagoike’s hours-long testimony.

On Thursday, Kagoike criticized the first lady for sending his wife an email that could be interpreted as an attempt to silence him.

But excerpts, copies of which were transcribed and distributed to the media by LDP lawmaker Shoji Nishida, suggested Akie Abe made little effort to actively engage with Junko Kagoike, whose tone veered from cordial to hostile and borderline hysteric.

A confused Akie Abe is recorded as emailing Junko saying that she doesn’t recall ever handing Kagoike the ¥1 million donation or receiving ¥100,000 in cash in exchange for delivering a speech at his Tsukamoto Kindergarten in September 2015.

At one point, according to the copies, Junko begged the first lady to help solicit the remaining ¥350 million she said was needed to get the new elementary school certified. Akie seemingly turned down the request, saying only: “I’ll pray for you.”

The messages also show that while the two were friendly in late February, Junko Kagoike started becoming exasperated as Abe began to voice displeasure in the Diet about her husband’s “stubborn” attitude in requesting that Akie Abe serve as the school’s honorary principal.

“I was so shocked to hear what the prime minister said in the Diet that I burst into tears for the first time,” a distressed Junko wrote to Akie Abe on Feb. 25. “I was even told by a lawmaker who visited our preschool that we should remove your picture to protect the LDP. I guess the lesson is political amateurs like us shouldn’t try to meddle in the world of politics.”

The first lady responded: “I suppose you probably should’ve been more careful to make sure my involvement wouldn’t be misunderstood as some sort of string-pulling.”

It is this remark that Kagoike said was tantamount to Akie Abe trying to gag him, but the prime minister on Friday clarified that it was “obvious” the first lady was merely trying to call for the Kagoikes to be more careful.

“I found Mr. Kagoike’s accusation very malicious,” Shinzo Abe said.

In another email correspondence with Akie Abe from the same day, Junko Kagoike, apparently in response to the growing public backlash against her kindergarten’s over-the-top nationalist education, complained: “I know it’s not very Japanese of me to be this overly suspicious … but I think there is a Satan out there trying to stop decent human beings like us from trying to do decent things.”

Now, however, the opening of educational entity Moritomo Gakuen’s new Mizuho no Kuni elementary school (almost named Shinzo Abe Elementary School), scheduled for April 1, has been postponed indefinitely.

It was revealed in February that the government land purchased for the school had been heavily discounted in a shady deal. That scandal led to revelations of Moritomo Gakuen’s links to Prime Minister Shinzo Abe’s wife, Akie, and Defense Minister Tomomi Inada, as well as to allegations so far unproven beyond a reasonable doubt by the entity’s chief Yasunori Kagoike that the new school received, via Akie Abe, a ¥1 million donation from the prime minister himself.

Kagoike gave sworn Diet testimony last week, where he repeated his assertions about Akie Abe, suggested Osaka Gov. Ichiro Matsui betrayed him by blocking approval of his new school, and said that three Osaka-based Diet members were involved. This has raised the stakes and national media attention, ensuring the scandal won’t go away.

As forceful as Kagoike’s allegations have been, the denials from those named as of late last week have been equally forceful.

After saying she could not remember, Akie posted a strong denial on social media that she’d handed over ¥1 million. Same with the three politicians named by Kagoike.

Nippon Ishin’s Toru Azuma of the Upper House denied doing anything on Kagoike’s behalf. Fellow councilor Takuji Yanagimoto of the Liberal Democratic Party said his office did little more than provide an introduction to officials over the phone. Former LDP lawmaker Issei Kitagawa said he’d never met Kagoike or even heard of him until the scandal broke.

In Osaka, attention has shifted to what Osaka Gov. Matsui, a close Abe ally despite heading the nominal opposition party Nippon Ishin no Kai, knew about the land deal and when he knew it. This has raised still unanswered questions about what the political and financial relationship other conservative groups and individuals might have had with Abe, Matsui and Moritomo Gakuen.

The scandal also has Osaka prefectural officials in charge of private school applications and central government officials at the Kinki Regional Finance Bureau blaming each other over who is responsible for selling Moritomo a hunk of land valued at ¥956 million for only ¥134 million. Earlier this month, a delegation of ruling bloc and opposition Diet members visited Osaka to try to determine how the deal came about but were told the prefecture had not kept detailed records.

What they did learn was that in summer 2011, the entity had asked the Osaka Prefectural Government to relax the restrictions on setting up private schools. The request was granted in April 2012, just a few months after Toru Hashimoto stepped down as governor and became Osaka mayor, and his ally, Matsui, became governor.

In September 2013, Moritomo told the Kinki Regional Finance Bureau, part of the Finance Ministry, that it was interested in acquiring government-owned property in Toyonaka, Osaka Prefecture, for its new elementary school. Negotiations began, with the finance bureau indicating Moritomo could reply about its interest if the project was approved. The prefecture, however, said that without land and a building, approval to operate could not be granted.

That October, the prefecture phoned the finance bureau to ask about progress and was told the bureau was relying on Moritomo to provide detailed documentation of its plans. A month later, the bureau said it told the prefecture that, once a final decision about the project was made, it would reply about whether it would negotiate the land deal.

Afterward, there was a long waiting period and the details are not clear. In October 2014, Moritomo submitted an application to have the elementary school approved by the prefecture. In December, the prefecture told Moritomo it was still discussing the matter. But in January 2015, the private-school section replied that authorization was considered “appropriate.”

In May 2015, a 10-year rental lease for the property was drawn up. But the following month, after deducting ¥800 million as the cost of removing garbage on the site, Moritomo was able to buy land originally valued at ¥956 million for only ¥134 million.

But official records of the negotiating process, especially from 2013 to 2014, do not exist, prefectural officials told the Diet delegation. The chronology they were presented with was based on interviews with officials who were in charge at the time.

“Notes were not taken and negotiations were done over the telephone. Preparing documents (of the negotiations) would leave a huge volume of paperwork,” Osaka Gov. Ichiro Matsui said.

The governor denied any suggestion he intervened with prefectural officials on Moritomo’s behalf.

“If I ordered preferential treatment to be given to Moritomo, I’ll resign,” Matsui said.

For his part, former Osaka Mayor and Ishin co-founder Hashimoto, who had been governor in 2011 when the entity originally asked for the rules regarding new private schools to be relaxed, blamed his lack of attention to the details of deregulation for the problem.

“It was my mistake. When I was governor, I had to make deregulation of private school regulations and the strengthening of the system of prefectural checks for private school applications part of a set. There were voices of concern about Moritomo’s finances. The prefecture appeared to confirm they were OK and this led to approval with certain conditions. But the origin of the problem is that my efforts to strengthen the prefecture’s system of checking on private school applications was insufficient,” Hashimoto said on his Twitter account and on television last week.

The mea culpa did little, however, to negate suspicion that the good deal Moritomo received had something to do with gubernatorial successor Matsui’s cozy relations with Abe. Both men share similar views on perceptions of history and education.

As do many of the groups in Osaka that support Nippon Ishin. One that has come under the spotlight is the conservative Japan Conference (Nippon Kaigi), which also advocates nationalist causes.

In a statement earlier this month, the group said Kagoike had once been a member but left in 2011. In an online interview published last week in Shukan Asahi, Japan Conference Chairman Tadae Takubo said his organization had no connection with Kagoike.

But Hashimoto said that while everybody who once supported, directly or indirectly, Moritomo and Kagoike may now be reluctant to admit it, the school’s nationalist educational philosophy enjoys a lot of support among prominent people.

“I wouldn’t make my own kids recite the Meiji Imperial Rescript on Education like Moritomo was doing. But from what I’ve seen and heard, the school taught respect and courtesy. Without a doubt, a lot of politicians, including within the LDP and even Nippon Ishin, supported the school’s educational philosophy. Therefore, a lot of prefectural officials took notice,” Hashimoto said.

Kansai Perspective appears on the fourth Monday of each month, focusing on Kansai-area developments and events of national importance with a Kansai connection.