A Japanese Madoff

Source : https://dofollownet.com

Nami Kazutsugi, a 75 years old Japanese businessman, who leads the L & G, is accused of having organized a system pretty similar to that of Bernard Madoff.

But just before his arrest Thursday February 5, he did not hesitate to say: "The police have ruined my business. Nobody has lost as much as me."

The "Ponzi Scheme" or "Pyramid Scheme" which he created between 2001 and 2007 allowed him to collect between 1 and 2 billions, by promising fabulous yields (nearly 36% last year) to his clients.

Funds from new investors were used to pay the interests of prior investors. More than 37,000 people might be victims of this fraud.

L & G issued its own currency, the "enten", a combination of ideograms "yen" and "paradise", that Mr Nami wanted to become a global currency.

For each deposit of $1000, the investor received 100,000 "enten" that he could spend in L & G stores, a sort of bazaar installed throughout the archipelago, the online sales sites or partner hotels.

He could theoretically recover his money after a year. But if he decided to leave in the hands of Mr. Nami, its stock of "enten" was automatically renewed for free.

Mr. Nami focused trust of his victims by highlighting the strength of its business which, he said, generates several billions yen per year.

L & G was founded in 1987. Before starting the activity that lead its boss in prison, the group was selling futons mattresses and parapharmaceutical drugs.

In February 2007, the company stopped paying the interest due and to redeem the partners intend to shops. In September, his staff was dismissed.

Today, L & G owe 366 million to its customers, while its current assets do not exceed 12 million.

Most victims are small investors who wanted to build up a capital for retirement.

Quoted by the Asahi newspaper, a woman from Saitama Prefecture (north of Tokyo) told that she cancelled a life insurance contract of $130,000 to place this sum at L & G.

She had convinced her husband and her eldest son to do the same. The family had lost $278000 euros.

Mr Nami still maintain that "This is not a fraud. It is business !"

A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or money paid by subsequent investors rather than from profit. The term "Ponzi scheme" is used primarily in the United States, while other English-speaking countries do not distinguish colloquially between this scheme and other pyramid schemes.
The Ponzi scheme usually offers abnormally high short-term returns in order to entice new investors. The perpetuation of the high returns that a Ponzi scheme advertises and pays requires an ever-increasing flowe going (source: Wikipedia).

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