Japanese Investment Company Executives Extradited on Charges Relating to $1.5 Billion Ponzi Scheme
Japanese authorities have extradited to the United States two former executives of a Las Vegas, Nevada, investment company in connection with their alleged roles in a $1.5 billion Ponzi scheme.
Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division, U.S. Attorney Nicholas A. Trutanich of the District of Nevada and Special Agent in Charge Aaron C. Rouse of the FBI’s Las Vegas Division made the announcement.
Junzo Suzuki, 70, and Paul Suzuki, 40, who are father and son and are both Japanese nationals, were each charged in a July 2015 indictment filed in the District of Nevada with eight counts of mail fraud and nine counts of wire fraud. Japanese authorities arrested the Suzukis in January 2019 at the request of the United States, and extradited them to the United States on April 17. The Suzukis will make their initial appearance this afternoon before U.S. Magistrate Judge Cam Ferenbach of the District of Nevada.
According to the indictment, Junzo Suzuki previously was executive vice president for Asia Pacific of MRI International (MRI), an investment company which was headquartered in Las Vegas and had an office in Japan. Paul Suzuki previously was the company’s general manager for Japan operations, based in Tokyo. MRI purportedly specialized in “factoring,” whereby the company purchased accounts receivable from medical providers at a discount, and then attempted to recover the entire amount, or at least more than the discounted amount, from the debtor.
According to allegations in the indictment, from at least 2009 to 2013, the Suzukis and their co-defendant Edwin Fujinaga, 72, of Las Vegas, fraudulently solicited investments from thousands of Japanese residents. When MRI collapsed, it allegedly owed investors over $1.5 billion. Specifically, the indictment alleges that Fujinaga and the Suzukis promised investors a series of interest payments that would accrue over the life of the investment and that would be paid out along with the face value of the investment at the conclusion of the investments’ duration. The defendants allegedly solicited investments by, among other things, promising investors that their investments would be used only for the purchase of medical accounts receivable (MARS) and by representing that investors funds would be managed and safeguarded by an independent third-party escrow company.
The indictment further alleges that MRI operated as a Ponzi scheme, in which the defendants used new investors’ money to pay prior investors’ maturing investments. According to the indictment, the defendants also allegedly used investors’ funds for purposes other than the purchase of MARS, including paying themselves sales commissions, subsidizing gambling habits, funding personal travel by private jet and other personal expenses.
In November 2018, after a five-week trial, Fujinaga was found guilty of eight counts of mail fraud, nine counts of wire fraud and three counts of money laundering in connection with this Ponzi scheme. His sentencing hearing is scheduled for May 23, 2019.
The case was investigated by the FBI. The case is being prosecuted by Trial Attorneys William Johnston and Danny Nguyen of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Tony Lopez of the District of Nevada. The case was investigated by Assistant Chief Albert Stieglitz of the Fraud Section and Assistant U.S. Attorney Steven Myhre of the District of Nevada.
The indictment contains allegations and the defendants are presumed innocent if and until proven guilty in a court of law.
The Criminal Division’s Office of International Affairs provided significant support with the defendants’ extradition. The U.S. Securities and Exchange Commission, the Financial Services Agency of Japan and the Japanese Ministry of Justice also provided assistance.