A Las Vegas executive and two associates from Tokyo were indicted by a federal grand jury on Wednesday for running an alleged $1.5 billion Ponzi scheme that bilked thousands of Japanese victims, the U.S. Department of Justice said.
The indictment charged Edwin Fujinaga, 68, who once ran MRI International Inc in Las Vegas, with eight counts of mail fraud, nine counts of wire fraud and three counts of money laundering.
Junzo Suzuki, 66, and Paul Suzuki, 36, both of Tokyo, were each also charged with the 17 mail and wire fraud counts.
Fujinaga and MRI were previously found liable for fraud in a related U.S. Securities and Exchange Commission civil case, and are appealing a $584.4 million judgment imposed on Jan. 27 by U.S. District Judge James Mahan in Las Vegas.
The alleged scheme centered on accounts receivable, which is money owed for goods or services already delivered.
U.S. prosecutors said the defendants solicited more than $1.5 billion, mainly from Japanese residents, from 2009 to 2013 by promising to buy accounts receivable from medical companies at a discount and recoup the full value later from insurers.
Instead, the defendants allegedly used new investor money to repay earlier investors and diverted some funds to pay themselves sales commissions, subsidize gambling habits and cover luxuries such as private jet travel.
Junzo Suzuki was executive vice president of MRI's Asia-Pacific operations, and Paul Suzuki was general manager of its Japan operations.
Fujinaga is a U.S. citizen. Junzo Suzuki a Japanese citizen, and Paul Suzuki a dual citizen, the indictment said.
Lawyers for Fujinaga did not immediately respond to requests for comment. It is unclear whether the Suzukis hired lawyers.
Wednesday's charges show the U.S. government's willingness to pursue "not only those who victimize American citizens, but also those who use the U.S. as a home base to defraud victims abroad," Leslie Caldwell, assistant attorney general of the Justice Department's criminal division, said in a statement.
The SEC previously accused Fujinaga of using fraud proceeds to pay for luxury cars, credit card bills, alimony, child support, and homes in Las Vegas, Hawaii and Beverly Hills, California. It said some of his investors also came from Canada, Malaysia and New Zealand.
The indictment charged Edwin Fujinaga, 68, who once ran MRI International Inc in Las Vegas, with eight counts of mail fraud, nine counts of wire fraud and three counts of money laundering.
Junzo Suzuki, 66, and Paul Suzuki, 36, both of Tokyo, were each also charged with the 17 mail and wire fraud counts.
Fujinaga and MRI were previously found liable for fraud in a related U.S. Securities and Exchange Commission civil case, and are appealing a $584.4 million judgment imposed on Jan. 27 by U.S. District Judge James Mahan in Las Vegas.
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The alleged scheme centered on accounts receivable, which is money owed for goods or services already delivered.
U.S. prosecutors said the defendants solicited more than $1.5 billion, mainly from Japanese residents, from 2009 to 2013 by promising to buy accounts receivable from medical companies at a discount and recoup the full value later from insurers.
Instead, the defendants allegedly used new investor money to repay earlier investors and diverted some funds to pay themselves sales commissions, subsidize gambling habits and cover luxuries such as private jet travel.
Junzo Suzuki was executive vice president of MRI's Asia-Pacific operations, and Paul Suzuki was general manager of its Japan operations.
Fujinaga is a U.S. citizen. Junzo Suzuki a Japanese citizen, and Paul Suzuki a dual citizen, the indictment said.
Lawyers for Fujinaga did not immediately respond to requests for comment. It is unclear whether the Suzukis hired lawyers.
Wednesday's charges show the U.S. government's willingness to pursue "not only those who victimize American citizens, but also those who use the U.S. as a home base to defraud victims abroad," Leslie Caldwell, assistant attorney general of the Justice Department's criminal division, said in a statement.
The SEC previously accused Fujinaga of using fraud proceeds to pay for luxury cars, credit card bills, alimony, child support, and homes in Las Vegas, Hawaii and Beverly Hills, California. It said some of his investors also came from Canada, Malaysia and New Zealand.
