Japan's financial watchdog starts investigation on top banks

Japan's financial watchdog started investigations Tuesday on the country's top three banks over their suspected links with organized crime groups.

The financial groups operating major lenders Mizuho Bank, the Bank of Tokyo-Mitsubishi UFJ and Sumitomo Mitsui Banking are now under on-site inspections, the Financial services Agency (FSA) revealed.

The move follows a recent scandal involving loans made by Mizuho Bank to people linked to criminal groups. The second biggest bank in Japan had extended about 2 million U.S. dollars in loans to Japanese gangsters, known in the country as the "Yakuza".

According to FSA, the main purpose of the investigation is to prevent major bank's ties with criminal groups.