Accountant behind Ponzi scam gets nearly 12 years

HONOLULU – A Maui accountant who led a long-running Ponzi scheme that cost his investors $8 million was sentenced Wednesday to serve nearly 12 years in federal prison without the possibility of parole.

Lloyd Y. Kimura used his business, Maui Industrial Loan and Finance Co., to attract investments since 1986, taking money collected from later customers to pay initial clients. He pleaded guilty in January.

Dressed in a white prison jumpsuit but without handcuffs, the 61-year-old apologized for his crimes.

“I’m sorry for what I’ve done, and I accept the ruling of the court,” Kimura told U.S. District Judge David Ezra.

Kimura, the brother of Hawaii County Prosecuting Attorney Jay Kimura, was ordered to repay his 50 victims the $8 million they lost.

His assets amount to only a fraction of the amount he owes, so at least 10 percent of his income must be paid to victims after he’s released from prison, Ezra said.

He was given 11 years, eight months in prison, a sentence on the high end of federal guidelines, which called for a prison term of between 10 years and 12.5 years.

Kimura’s sentence may have been higher if he hadn’t cooperated with authorities to repay his victims and accept guilt, Ezra and Assistant U.S. Attorney Ken Sorenson said.

Ezra said Kimura was motivated by “personal greed” when he lost his victims’ life savings and college savings, denying them comfortable retirements and the ability to provide educations for their children.

“The defendant clearly betrayed the trust of his clients and friends in a scheme that lasted nearly two decades,” Ezra said. “I do hope this will send the right message to individuals that they had best not engage in inappropriate conduct. . . . They will not receive a slap on the wrist.”

Sorenson said Kimura operated the longest-running Ponzi scheme he’s ever seen, which lasted until Kimura’s business ran out of money in 2009. It survived for so long because he paid his early investors, many of whom made money, which gave later clients false confidence that Kimura was running a legitimate business, Sorenson said.

“When you have so many victims and so much money lost, we feel the perpetrators of these kinds of schemes should serve substantial periods of time in prison, perhaps much more than Mr. Kimura got,” Sorenson said. “He was stringing people along for a very long period of time.”

At least one victim lost more than $1 million, Sorenson said.

Kimura used his profits to pay for personal expenses and keep several businesses running, including Maui Finance, Wailuku Tire Co. and his accounting practice, Sorenson has said.

He also pleaded guilty in December to breaking state securities laws, which came with a 20-year sentence that will be served at the same time as his federal sentence.

Kimura is eligible for parole under the state sentence, which means the 12-year federal sentence may turn out to be more severe, Ezra said in court.

Accountant behind Ponzi scam gets nearly 12 years – Mauinews.com | News, Sports, Jobs, Visitor’s Information – The Maui News

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