According to SEC pleadings and other court papers, MRI International, Inc. and CEO Edwin Fujinaga had a simple pitch to investors MRI was using their funds to buy accounts receivable from medical providers at a discount and subsequently collecting the full value of those receivables from insurance companies. Except that simple plan is not what MRI and Fujinaga did with the investor money, millions of which came from investors in Japan.
In September 2013, the SEC brought the case on an emergency basis and obtained a temporary restraining order and an asset freeze before the litigation commenced because, according to SEC papers, MRI and Fujinaga perpetrated an elaborate Ponzi scheme designed to misappropriate money from investors and were using the money raised for other purposes including financing Fujinaga’s extravagant lifestyle.
In October 2014, the court granted the SEC’s motion for summary judgment on liability against Fujinaga and MRI on all charges against them, including the following violations of the antifraud provisions of the federal securities laws and on January 27, 2015 in Nevada district court, the SEC obtained a final judgment against Edwin Fujinaga and MRI International, Inc. Under the judgment defendants, Fujinaga and MRI, are jointly and severally liable for disgorgement of proceeds in the amount of $442,229,611.70 and for prejudgment interest in the amount of $102,129,752.38. Additionally the judgment imposes civil penalties of $20 million against each defendant. In total, Fujinaga and MRI are required to pay more than $580 million as a result of the civil enforcement action and are permanently enjoining the defendants from further securities violations.
If you or someone you know is believed to be the victim of this or another elaborate Ponzi scheme, please contact our office immediately at (619) 990-7491.
This securities law blog post about enforcement is provided as a general informational service to clients and friends of Feinstein Law, PA and should not be construed as, and does not constitute, legal and compliance advice on any specific matter, nor does this message create an attorney-client relationship. For more information concerning the rules and regulations affecting the going public direct transactions and direct public offerings please contact Feinstein Law, PA at (619) 990-7491 or by email at Todd@Feinsteinlawfirm.com or JDunsmoor@Feinsteinlawfirm.com. Please note that the prior results discussed herein do not guarantee similar outcomes.
