Tokyo is investigating serious fraud allegations involving a Japanese defence contractor linked to the country’s advanced Mogami warships scheduled to soon be built in WA.
BREAKING NEWS: A major fraud scandal is unfolding as Japan’s Kawasaki Heavy Industries faces serious allegations of falsifying fuel efficiency data linked to the country’s advanced Mogami warship project. Authorities in Tokyo have initiated a detailed investigation into the contractor, which is crucial to the $10 billion SEA3000 program that includes constructing a fleet of frigates for the Royal Australian Navy.
Kawasaki is accused of manipulating data for diesel engines utilized in the Japanese Maritime Self-Defence Force submarines. This scandal could lead to the company’s suspension from future military bids, casting a shadow over the upcoming construction of Mogami warships in Western Australia.
Japanese Defence Minister Shinjirō Koizumi confirmed the investigation and stated that it involves on-site inspections conducted alongside Kawasaki’s internal review. “As the investigations are ongoing, I cannot provide further details. Once the facts are confirmed, we will respond appropriately,” Koizumi said on Friday.
Reports indicate that Kawasaki has been reporting falsified figures since at least 2002, attempting to meet ministry standards while minimizing measurement discrepancies. This is not the first issue for the company; it received two strict warnings from the Defence Ministry since December 2024 over a slush fund scandal, involving inappropriate gifts totaling 1.7 billion yen ($16.2 million).
The scandal’s implications extend to international partnerships. The Australian Government selected Mogami as the winning design for the new frigates, which are powered by Rolls-Royce gas turbine engines produced under license by Kawasaki. The first three warships are scheduled to be built in Japan by Mitsubishi Heavy Industries before moving construction to Henderson, Australia.
Concerns about security and intellectual property have also been raised. Minister Koizumi addressed local worries regarding a recent decision allowing Hanwha, a South Korean defence giant, to double its ownership of Austal, the WA-based shipbuilder involved in the Mogami project. Earlier this month, Treasurer Jim Chalmers confirmed Hanwha’s stake increase from 9.9% to 19.9% under strict conditions.
“I am aware that the Australian Treasury announced on the 12th (December) that it would not object to Hanwha’s proposal,” Koizumi stated, emphasizing the importance of safeguarding Japan’s technical information. He assured that appropriate measures would be taken in the joint development of the frigates.
Adding to the complexity, the Japanese government has expressed ongoing concerns about Hanwha’s increased stake in Austal, having communicated with the Australian Defence Department multiple times prior to the decision. Austal has faced challenges in its relationship with Hanwha, which had previously attempted a failed $1 billion takeover bid last year.
In another development, Koizumi did not elaborate on discussions regarding potential exports of Mogami warships to New Zealand but affirmed that both nations would maintain close communication on the proposal.
This scandal raises significant questions about the integrity of military contracts and international defense collaborations, as both Japan and Australia navigate the fallout from these allegations. Follow this story for ongoing updates as investigations continue.
