Las Vegas investment company boss arrested in $1.5B fraud case
July 9, 2015 - 4:27 pm
FBI agents on Thursday arrested the president of a Las Vegas-based investment company charged with running a $1.5 billion Ponzi scheme.
Edwin Fujinaga, 68, headed MRI International Inc. in Las Vegas and was a major contributor to the 2011 election campaign of Mayor Carolyn Goodman.
At an initial appearance in federal court, Fujinaga pleaded not guilty to a series of fraud charges and was ordered released on his own recognizance with travel and other restrictions, including surrendering his passport.
Federal prosecutors did not oppose his release pending trial Sept. 14.
Fujinaga and two former executives based in Japan were indicted by a federal grand jury on Wednesday in the international case, which has been followed closely by the Japanese news media.
Junzo Suzuki, 66, the company’s vice president for Asia Pacific, and his son, Paul Suzuki, 36, general manager for Japan operations, are believed to be in Japan and are not in custody.
In announcing the indictment Wednesday, Assistant Attorney General Leslie R. Caldwell said: “The defendants allegedly preyed on thousands of unsuspecting Japanese victims to enrich themselves by operating a billion-plus dollar Ponzi scheme.”
Fujinaga and the Suzukis fraudulently solicited investments from thousands of Japanese residents from 2009 to 2013, the 20-count indictment alleges.
The defendants are alleged to have used investor money to unlawfully pay themselves sales commissions, subsidize gambling habits and fund their personal travel by private jet.
Fujinaga used money in the scheme to pay off his personal credit cards, buy luxury cars and pay a total of $25,000 in alimony and child support, according to a civil complaint filed by the U.S. Securities and Exchange Commission in September 2013.
In February, a federal judge in Nevada granted an SEC request for a $585 million civil judgment against MRI International and Fujinaga.
MRI, which was incorporated in Nevada in 1998, purportedly specialized in a practice called “factoring,” in which accounts receivable were purchased from medical providers at a discount and an attempt was made to recover more than the discounted amount from the debtor, the indictment alleges.
In local politics, Fujinaga contributed a total of $50,000 to Goodman’s first campaign in 2011.
Goodman said Thursday she has no immediate plans to return the money.
A statement released by a city spokeswoman on Thursday suggests she plans to “let the justice system run its course,” before making a decision on the campaign cash.
“There is the presumption of innocence until proven guilty in this country,” Goodman said in the statement, “and I am neither a lawyer nor one who is familiar with the case.”
She did not return requests for further comment.
Although MRI has been in default on payments owed to investors since at least 2011, it’s unclear if the mayor could have known of the company’s suspected fraud at the time she accepted Fujinaga’s money.
Candidate financial disclosures on the Nevada secretary of state’s website show neither Fujinaga nor any of his business partners have donated to any campaign since 2011.
Donations made that year by Fujinaga or one his affiliate companies represent 7 percent of the total cash Goodman raised from January to March 2011.
He was the largest individual contributor to the mayor’s campaign over that period, joining Jack Binion; El Cortez Hotel; and Dennis Mastro — a former Oscar Goodman client with past ties to reputed organized crime figures — on a long list of major donors.
It’s not clear whether, or how, the two-term mayor might plan to repay donations from Fujinaga. Goodman’s latest contributions and expenses report, filed on May 29, shows a deficit of more than $14,100.
Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135. Find him on Twitter @JGermanRJ. Contact James DeHaven at jdehaven@reviewjournal.com or 702-477-3839. Find him on Twitter: @JamesDeHaven.