Beware the Better Business Bureau

An investor who relied only on the BBB’s rating of Kimura’s company would have lost his or her entire investment.

Hawaii News Daily is reporting that the Hawaiian Better Business Bureau rates Maui Industrial Loan and Finance Company an A+ a week after the conviction of the company’s president, Lloyd Kimura, on charges that he used the company to operate a 24-year Ponzi scheme.  The story is a reminder that effective due diligence requires much more than checking with the Better Business Bureau.  The BBB has earned a good reputation over the years for informing inquiring consumers that other consumers have complained about a company’s goods or services.  No doubt, BBB does it’s best to provide the best information to those who inquire.  As this case illustrates, though, they sometimes get it wrong.  An investor who relied only on the BBB’s rating of Kimura’s company would have lost his or her entire investment.  Trust me, it will be no comfort when you lose your nest egg to be able to say “They had a good rating from the Better Business Bureau.”  You must do more.

Hawaiian Ponzi Scamster Sentenced

Never rest your decision to invest on the professional license of the person offering an investment.

Certified Public Accountant Lloyd Kimura offered purchasers of Maui Finance promissory notes substantially more in interest than they could earn through bank certificates of deposit.  Dozens of people invested more than $6 million in the notes.  Last week, Kimura admitted to running a Ponzi scheme and a state court judge sentenced him to 20 years in prison. According to an article in The Maui News: (more…)

The Runners (Part 1)

In the next few posts, we will address the several recent accused scamsters who have decided to make crime pay by skipping town before law enforcement can insist that they answer the charges against them.

Sometimes they run.  Sometimes it works.  One of the investment thieves I chased while I was an Enforcement Branch Chief at the SEC was a registered investment adviser named Homer Forster.  He skipped across the U.S./Canadian border with a phony passport just hours ahead of our sending a border watch to the U.S. Customs service.  Homer was on the lam for ten years, spending the $1.7 million in client money that he took with him.  Interpol finally caught up to him, living in a lovely town on the Mediterranean coast of France. (more…)

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