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>> A live TV testimony shaking Japan all the way to the top. The principal of an ultra right-wing nationalist schools swearing before parliament, Thursday, that he personally received the donation from the wife of Prime Minister Shinzo Abe in her husband's name. And it didn't stop there.>> I believe there had to be political intervention to help us acquire the public lands for the construction of our school.
>> It's a swirling scandal denting Abe's popularity. This isn't the first time the principal has made allegations against him, but it is the first time it's happened under sworn testimony. And as Elaine Liz reports from Tokyo, that raises the stakes.>> He is doing it under oath. And if he is found to have lied, he could be liable under law.
The risk for Abe is that he has said, if he was involved in the land deal, he'll quit. This is a threat if it broadens out and it taints his name enough, he might even be forced out of office.>> Abe denies any links to improper donations or knocking a big chunk of the price of the land where the school was built.
But those aren't the only things threatening his reputation. The type of school he's accused of backing is controversial to say the least.>> They were teaching the values that they used to teach when the emperor was considered the god, and people were supposed to give their lives for the country and these tiny children in their nursery school and the kindergarten have been forced to memorize all sorts of pre-war propaganda.
They have issued letters that put down Koreans and Chinese so that there have been allegations of hate speeches as well. Japan's NIKKEI dipped to a month and half low as the testimony went out on screens across the country. A lingering scandal doesn't bold well for Abe as he eyes up a third term in power.
He's already had to stand down as prime minister once and that was in the wake of a scandal.