The chairman of a company providing funeral services has been arrested on suspicion of fraud.

According to police investigators, Yoshito Naka, the chairman of an undertaking company in Naha, was arrested on suspicion of making fraudulent documents to help a female acquaintance, who is a Chinese national, to obtain a bank loan police suspect was used to finance a prostitution operation.

Naka supposedly became friends with the woman, and then provided her with a fraudulent paperwork showing her to be an employee of his company and helped her to obtain a loan from a bank.

Both Miyagi and Okinawa Police, after a joint investigation, arrested the woman earlier in July on suspicion of violating Japanese anti-prostitution laws. She is suspected of having managed about 200 Chinese women who worked as prostitutes. The woman allegedly profited about ¥100 million from the operation.

According to investigators, Naka was arrested Oct. 27 on suspicion of forging a document showing his company employed the woman, and helped her to obtain a loan from a bank. Police are investigating the possibility that the loan was used as the source of funds to set up and operate the prostitution ring.

The Chinese woman solicited customers on online dating Web sites she managed, and recruited women by placing advertisements on websites aimed at Chinese people, and also through advertising on free newspapers for Chinese living in Japan.

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