To my knowledge, Japan's Yakuza used to be highly involved with the government. That's basically just a rumor though. I don't have any details. The rumor also says that this is no longer really the case anymore.
I cannot answer about the original rumor, but I can say in the last ten years there has been a dramatic (economic) fall for the Yakuza. Slowly, the Japan gov't has passed tighter and tighter domestic money laundering laws -- taxes, building / business permits, banking, etc. Many times I have been asked to sign a form stating no connection with "anti-social forces". The Japan gov't is putting the economic equivalent of the "sleeper hold" on Yakuza. You hardly see them now (in visibly obvious forms) except the dodgiest places. I never see anyone with a missing half their pinky finger. (Yes, it is real / weird / scary.)
