In 1872, he used official army funds to make illegal loans to Wasuke of Yamashiroya, a merchant who was doing business with the army, and allowed the loans to be unrecoverable.
明治5年（1872年）、山縣は陸軍出入りの商人、山城屋和助に陸軍の公金を不正融資して焦げ付かせる。