Yoshifumi Kuwao, 52, is suspected of withdrawing the money from the Buddhist faction's bank account on about 30 occasions from January 2003 to September 2004 and pocketing it while he was in charge of treasury affairs at the headquarters, police said.
Kuwao has owned up to the allegations, they said.
Police sources said Kuwao is believed to have used most of the funds to invest in futures trading.
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