Japanese firm named in racketeering case

Racketeering charges were filed against two japanese nationals and a Japanese firm for alleged fraud and embezzlement of funds in connection with the development of Coral Ocean Point, a hotel and golf course in the southern part of Saipan.

Named respondents in the civil suit filed by lawyer James Grizzard based on the Racketeer Influenced and Corrupt Organizations Act were Kiyoshige Terada, chairman of the board of directors; Minoru Imai, president; and Japanese firm Hyakumata Kabushiki Kaisha.

According to the complaint, Mr. Terada, Mr. Grizzard and Mr. Imai established Suwaso Inc. in 1985 for the development of COP. Mr. Grizzard owns 10 percent of the shares of the company.

Hyakumata and Mr. Terada arranged directly with a company known as Kam Corp. to construct the project, but barred Suwaso Corp. from dealing directly with Kam.

Since construction started, Hyakumata and Mr. Terada allegedly jacked up the cost of the project from to $20 million from $10 million. In misrepresenting the real cost of the project to Mr. Grizzard, they produced various documents that have been sent over international wires and through the mail.

This led Mr. Imai to remit more than $11 million from Suwaso in Saipan to Hyakumata’s accounts at the Umeda branch of the Sumitomo Bank in Osaka, Japan through international wire facilities from 1989 to 1998.

During this same period, Mr. Terada, Mr. Imai and Hyakumata allegedly conspired to transfer huge amounts of Japanese yen to Mr. Terada and Hyakumata by personally carrying the cash from Saipan to Osaka, Japan without filing the required customs report.

Mr. Terada allowed Mr. Imai to misappropriate large amounts of Suwaso funds and convert them to his own use and use the Suwaso accounts as if they were his own personal accounts, according to court documents.

In 1998, Mr. Imai even reported to Mr. Grizzard that he had discovered Hyakumata and Mr. Terada had made misrepresentations to defraud the company. He even asked for Mr. Grizzard’s help to uncover the fraud and demanded an accounting.

Mr. Grizzard later on confirmed that fraud had been perpetrated by Terada, Hyakumata and Imai on Suwaso which include fraudulent loan documents, misrepresentations regarding construction costs as well as misappropriation of funds during the course of the litigation.

These all caused damage to Mr. Grizzard’s business and property, the complaint said. The board has refused to conduct an accounting and even ignored the evidence of fraud.