AICHI (TR) – An organized crime member and a former police officer are among the 10 suspects arrested in connection with a Ponzi scheme that included more than 10,000 members, police said, reports TV Asahi (Feb. 14).
Police had already announced the arrest of Masato Doko, the 41-year-old chairman of Texsear Japan Holdings, former president Keizo Adachi, 58, for allegedly 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.
Among the eight other persons in custody are Tokiji Nakamura, a 66-year-old member of the Kodo-kai, which is an affiliate gang of the Yamaguchi-gumi, and Teruhisa Miyoshi, a 60-year-old former member of the Okayama Prefectural Police.
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.
Up the rankings
According to a previous report, Texsear Japan Holdings 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.
The members were divided into four classes. Members moved up the rankings based on the number of other members they recruited, police said.
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.
Many of the victims did not have contracts with Texsear Japan Holdings. Instead, they were provided with I.O.U. documents, police said.
Miyoshi was in charge of a fraud division while with the Okayama police. For Texsear Japan Holdings, he served as an adviser who gave the instructions for the use of the I.O.U. documents in lieu of contracts to avoid violations of lending laws, police said.
In July of last year, police began raiding locations connected to Texsear Japan Holdings. All told, police suspect that the company collected around 46 billion yen from about 13,000 members.