Japan's 'Shadow Shogun' to hear trial verdict

Japan's ruling Democratic Party of Japan powerbroker Ichiro Ozawa (pictured in 2011) is set to hear his fate when a court delivers its verdict on a years-old funding scandal

One of the biggest figures in Japan's political scene is set to hear his fate on Thursday when a court delivers its verdict on a years-old funding scandal.

Prosecutors have demanded Ichiro Ozawa, once dubbed the "Shadow Shogun", be jailed three years over allegations he conspired with aides to hide 400 million yen ($4.9 million) he lent to his political funding body in 2004 to facilitate a land deal.

His aides said the mistake was purely technical and their boss had not been aware of it, while prosecutors said it was "unthinkable" Ozawa had not been in the loop.

Ozawa, the head of the largest faction in the ruling Democratic Party of Japan (DPJ) and often seen as the power behind the premiership, has accused the prosecution of "an abuse of state power" aimed at sidelining him.

Ozawa repeated his claims of innocence during closing arguments in March, saying the case was based on "fake depositions and reports fabricated by the Tokyo District prosecutors."

The media-shy veteran politician helped the centre-left DPJ to power with an electoral landslide in 2009 that saw Yukio Hatoyama rise to the premiership.

But the strongman's position has weakened since Hatoyama's short stint in the top job ended the following year.

If Ozawa is found guilty, he could be expelled from the ruling party, the Asahi daily quoted an anonymous source as saying. On the other hand his acquittal could be "a foothold for his comeback," the major daily said.

Ozawa and his proteges are against Prime Minister Yoshihiko Noda'a drive to double the current five percent consumption tax to help keep state debts from snowballing further.