Tag: ponzi

July 14, 2011 General Ag News and Notes Post a Comment

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.

Continue reading
January 7, 2011 General Ag News and Notes 1 Comment

Hawaii County Prosecutors Quit

Friends for Justice learned today that 5 employees in the Hawaii county prosecutors office resigned on or around January 4th.

East Hawaii has 24 prosecutors.

Information is scarce, and no one is talking, but we have reason to believe the majority of resignations may have all been out of the East Hawaii office in Hilo. This corresponds with Hawaii county prosecutor Jay Kimura’s brother Lloyd Kimura pleading guilty to nine counts of bank and mail fraud and theft in a 24 year ponzi scheme involving 50 clients and the theft of over 20 million dollars. That story like this one got no coverage in the local Hawaii county newspapers.

Friends for Justice was in court in Hilo Thursday January 6th in Judge Hara’s court supporting Reverend Nancy Harris’s religious marijuana case. The prosecutor in that case Rick Damerville made reference to an event in the prosecutors office on January 4th in response to the judges inquiry about scheduling a trial date for Reverend Harris. The defendant in the case made inquiries, because her trial was delayed until July and was told Damerville was staying because of an unexpected mass exodus from Jay Kimura’s office. The prosecutor in Rev. Harris’s case (Damerville) had been scheduled to retire in the near future but said he would be staying on indefinitely.

The widespread corruption in Hawaii county government and Mr. Kimura’s refusal to pursue those cases as well as the dead ends in other high profile murder cases like Peter “boy” Kema Jr, and Clayton Larry Alani, may have been too much for some of the employees in the office.

Continue reading
January 5, 2011 General Ag News and Notes Post a Comment

Maui man pleads guilty to Ponzi scheme

A Maui man who previously pleaded guilty to violating state financial securities laws in connection with his operation of a multi-million-dollar Ponzi scheme pleaded guilty in federal court this morning to mail fraud and bank fraud.

As part of his agreement with the federal prosecutor, Lloyd Y. Kimura, 61, of Wailuku, was to turn himself in this afternoon pending sentencing in June.

Kimura pleaded guilty today to four counts of mail fraud, two counts of bank fraud and three counts of theft of employee pension benefits.

“I took money from people I knew and did not pay them back,” he said.

Kimura faces maximum 20-year prison terms for the mail fraud and bank fraud and five-year prison terms for the theft when a federal judge sentences him in June. He faces a mandatory 20-year prison term for securities fraud when a state judge sentences him next month.

State and federal prosecutors have agreed that Kimura will serve his state and federal sentences at the same time in federal prison.

Kimura has agreed that the people who “invested” money with him lost between $7 million and $20 million.

His lawyer, Philip Lowenthal, said the U.S. Bankruptcy Court is doing the accounting to determine exactly how much each investor lost and expects to have a total figure by this summer.

Continue reading
December 24, 2010 General Ag News and Notes Post a Comment

Charges filed against Maui businessman

WAILUKU – The state attorney general has charged Maui businessman Lloyd Kimura with two counts of prohibited securities practice and two counts of making false or misleading financial statements.

The complaint was announced in a news release Thursday evening. It had been filed in 2nd Circuit Court on Monday.

Kimura’s attorney, Phil Lowenthal, said he had been talking with prosecutors for months to reach a settlement in the collapse and bankruptcy of Kimura’s businesses.

Kimura waived a grand jury, so the charges were presented as an information, not an indictment.

Kimura, 61, is president of Maui Industrial Loan & Finance Co. and for many years operated Lloyd Y. Kimura Inc., a certified public accounting firm.

The complaint alleges that between June 30, 2008, and June 30, 2009, Kimura filed false or misleading statements and omitted statements required by law on behalf of Maui Industrial Loan. These had been filed with the Financial Institutions Division of the Department of Commerce and Consumer Affairs.

The complaint also alleges that between February 2007 and June 2009, Kimura, in connection with the offer, sale or purchase of any security, employed a scheme to defraud people in amounts greater than $100,000.

Prohibited securities practice is a class A felony with a maximum penalty of 20 years or a fine of $50,000 or both. Making false financial statements is a class C felony with a maximum penalty of five years or a fine of $20,000 or both.

Continue reading
October 22, 2010 General Ag News and Notes Post a Comment

Lawsuit claims Maui Industrial Finance was a Ponzi scheme

Dane Field, the trustee in the Maui Industrial Finance Co. bankruptcy, is suing 25 investors in the company to recover money they received as interest over and above their original investment or deposit, claiming the money was not really interest but the fruits of a Ponzi scheme.

Field’s attorney, Bradley Tamm, said Maui Industrial’s owner, Lloyd Kimura, acknowledged during depositions earlier this year that he had used money from late investors to pay off early investors, without really generating income from operations.

This is the definition of a Ponzi scheme, said Tamm. The supposed business – in this case, a loan company also known as Maui Finance – does little or no real business but simply takes money from new investors (or depositors) and uses it to pay interest or dividends to previous investors (or depositors).

At Maui Finance, people turned over cash to Kimura – in one case, $2 million – expecting to receive interest well above what commercial banks were paying on certificates of deposit.

In the creditors’ meetings after the bankruptcy, some people said they thought they were making deposits in a banklike institution. In 2009, the state Division of Financial Institutions ordered Maui Finance to stop taking deposits, and the business collapsed.

Tamm said that in depositions, Kimura admitted that he had been operating a Ponzi scheme almost from the day he became sole owner of the company around 1985.

Continue reading