AICHI (TR) – Aichi Prefectural Police have arrested the head of a company suspected of running a member-based Ponzi scheme that accumulated in excess of 45 billion yen from more than 10,000 persons, reports the Nikkei Shimbun (Feb. 13).
Thus far, police have accused Masato Doko, the 41-year-old chairman of Texsear Japan Holdings, former president Keizo Adachi, 58, eight other persons of defrauding three persons, aged in their 60s and 70s and living in Aichi, out of a total of 64 million yen over a one-year July, 2017.
In carrying out the ruse, the suspects claimed to the victims that they would receive interest of 3 percent on investments in increments of one million yen. “After one year, you can choose to redeem the principal or continue the contract,” the victims were told, police said.
Police did not reveal whether the 10 suspects admit to the allegations.
Texsear Japan Holdings, which is based in Chiba City, Chiba Prefecture, began collecting funds from victims in September, 2013. With Doko at the top, the company operated like a pyramid scheme, with members tasked with soliciting funds for supposed investment from within specific regions across the country. These members were then promoted within the company based on the amount of money they brought in.
The company held seminars titled “The Assembly to Energize Japan” for solicitation in various locations. Members were also wooed with luncheons and trips. However, dividends on investments stopped being paid around September, 2017.
Texsear Japan Holdings subsequently apologized for the delay, with the company citing the reason as being due to investment “in businesses that are expected to grow rapidly.” He also promised to returned the amounts cited in the contracts. However, the majority has not been returned.
Among members, Doko is known as “the King.” Often attired in a hat, flashy suit and sunglasses, he sings in a band that performed at events held to solicit investments.
“Talk to my lawyer”
In July of last year, police began raiding locations connected to Texsear Japan Holdings. All told, police suspect that the company collected 46 billion yen from 13,000 members.
Prior to his arrest, TBS News approached Doko. “There is nothing illegal,” he told the network. “Talk to my lawyer.”
Plaintiffs have been awarded payouts by courts in civil lawsuits that have been filed over the non-return of investments. A lawyer for one plaintiff told the Nikkei, “With the company not even showing up for the trial, I do not know if there will ever be a payment made down the line.”