LAS VEGAS – Two former investment managers from Japan, pleaded not guilty in Las Vegas on Thursday to criminal fraud charges in what prosecutors have called a $1.5 billion international Ponzi scheme.
Junzo Suzuki, 70, and his son, Paul Suzuki, 40, arrived in custody in the U.S. on Wednesday, and appeared before a federal magistrate who is a court hearing next Wednesday to decide whether they will be released from prison pending his trial.
Their attorneys, Richard Wright and Junji Suzuki, declined to comment outside the court. Junji Suzuki said he is not related to the suspects.
Junzo Paul and Suzuki were arrested in Japan in January, two months after a federal jury in Las Vegas found their co-defendant, Edwin Fujinaga, 72, guilty of 20 counts of mail fraud, wire fraud and money laundering.
Fujinaga once at the head of a Las Vegas-based company, MRI International Inc., with thousands of Japanese investors-turned-victims.
He is expected to face what would be an amount equal to the remainder of his life in federal prison sentencing, which was postponed last week and reset for May 23. Prosecutors asked the judge to sentence him to 50 years in prison.
In court documents, the AMERICAN lawyers have compared the case in Las Vegas, the largest U.S. Ponzi scheme prosecution: Bernard Madoff guilty plea in 2009 in New York, Allen Stanford’s conviction in Houston in 2012, and Scott Rothstein’s guilty plea in 2010 in Miami.
Madoff, now 80, was sentenced to 150 years in prison for bilking thousands of investors out of at least $20 billion. Stanford, 69, is serving 110 years for a scheme involving more than $7 billion. Rothstein, 56, is serving 50 years in a $1.2 billion case.
Court documents say Junzo Suzuki was MRI International executive vice president, and Paul Suzuki managed Tokyo activities.
From approximately 2009 to the beginning of 2013, the public prosecutor said that more than $1 billion in investments from more than 10,000 Japanese investors was wired to bank accounts in Las Vegas under Fujinaga. Investors were told that they are buying claims from a medical collection business, according to the indictment in the case.
Instead, Fujinaga was found guilty of the use of new investors money to pay off the previous investors and spending the rest on themselves, including a Las Vegas golf course mansion, a private jet, luxury cars and real estate in California’s wine country, Beverly Hills and Hawaii.
Prosecutors say that when the Japanese government repealed MRI, the license on the market of securities in April 2013, the firm owed investors more than $1.5 billion.