Japanese financial regulators have revoked MRI International Inc. of its registration as an asset manager, accusing the Las Vegas-based firm of mismanaging client funds and falsifying financial records.
The Securities Exchange and Surveillance Commission said Friday that it was investigating MRI International and found the firm had failed to manage its clients’ accounts appropriately. The company claims to have more than $1.3 billion in client assets.
Japanese regulators question the firm’s asset claims because MRI International, the regulators allege, provided false asset information in official documents for 2010 and 2011.
Messages left with MRI Financial in Las Vegas were not returned. The state’s Division of Financial Institutions had no record of MRI International being licensed in Nevada.
Reuters reported that because the client money was handled outside of Japan, financial regulators have sought the cooperation of the U.S. Securities and Exchange Commission.
Regulators allege that MRI International failed to direct new money from investors into its financial products and instead used those funds to pay dividends and redemption fees for principal and interest.
The SESC alleges the company failed to deliver payments on time to clients and did not issue account status reports. Reuters said the SESC may file charges.
The SESC’s parent agency, the Financial Services Agency, canceled MRI International’s registration in Japan.
The privately held asset management company claims it has some 8,700 Japanese investors.
MRI International advertised annual returns of 6 percent to 8.5 percent from its business of collecting accounts receivables from purchases at a discount rate from medical institutions in the United States.
The firm’s Tokyo office was raided Friday by Japanese investigators. MRI International in Las Vegas is located at 5330 S. Durango Drive.
Contact reporter Chris Sieroty at firstname.lastname@example.org or 702-477-3893.