TORRANCE — When a long-time customer of the Bank of the West-South Bay told the manager, Teruichi “Terry” Horikawa, of an investment she was considering in the late spring of 2014, he not only became concerned, but found himself in the middle of a fraud scam, ultimately saving the 74-year-old woman hundreds of thousands of dollars.
Out of concern for the elderly woman’s financial security, as well as the fact that the woman was of Japanese descent with limited English-speaking skills, Horikawa orchestrated a lunch meeting with her and the person who was providing her with information about the investment.
After the meeting, Horikawa expressed concern to the woman about the investment and advised her against it, until additional information was learned. He strongly recommended she seek advice from her children, who are fluent in English and would better understand the complexities of the investment and any documents related to it.
On Sept. 9, 2014, the elderly woman entered Bank of the West-South Bay, in the company of a male and a female of East Indian descent. They completed the necessary paperwork to wire-transfer approximately $200,000 from her bank account to the account of the company owned by the man and woman. However, based on the time of day, the wire transfer could not be initiated on that day.
Horikawa checked bank records and learned that approximately another $200,000 had recently been wire transferred into the elderly woman’s bank account from an escrow company. He surmised that the woman had refinanced her real estate in order to make the investment.
On Sept. 12, 2014, the elderly woman returned to Bank of the West with the female from the prior visit and a second woman, also of East Indian descent. This time the first female presented Horikawa with a Power of Attorney that had been notarized by the second female. The Power of Attorney authorized the first female to make financial decisions on behalf of the elderly woman.
Horikawa had noted that none of the East Indian individuals spoke Japanese and he knew the elderly woman did not speak English.
Horikawa began speaking to the elderly woman in Japanese in order to ascertain if she knew what was happening. In speaking to her, he learned that the woman did not know anything about the company she was investing in, the specifics of the investment, or the refinance of her real estate.
Out of concern for the elderly woman, Horikawa, who is not only the commercial branch manager but also the vice president for Bank of the West at the South Bay Branch, telephoned Bank of the West fraud investigators to seek direction and advice. The fraud investigators telephoned the Los Angeles County Sheriff’s Department Fraud and Cyber Crimes Bureau, Elder Fraud Detail.
This was all done while the elderly woman and the two East Indian females waited at Horikawa’s desk.
Based on the totality of the information, Elder Fraud Detail detectives immediately initiated an investigation. The wire transfer was stopped and the elderly woman’s money was preserved. However, it was later learned that she had already “invested” $80,000 with the company.
Elder Fraud Detail detectives identified a bank account belonging to the company that contained a large sum of money and sought and obtained judicial authorization to freeze the company’s bank account.
Over the course of the following year, the criminal investigation revealed a complex investment fraud scam. Detectives served over 10 search warrants and court orders and seized thousands of documents. Detectives also worked with the U.S. Securities and Exchange Commission and the California Department of Business Oversight to complete the investigation.
The case is currently under review by the Los Angeles County District Attorney’s Office for filing of 31 felony counts against three employees of the company, including the chief executive officer and chief legal counsel.
It is anticipated that the seizure of the company’s bank account will ultimately provide funds for restitution of the $80,000 the elderly woman “invested” with the company.
“Were it not for Mr. Horikawa’s concern for the elderly woman and his decisive and proactive action, it is highly likely that the elderly woman would have lost the vast majority of her modest estate and been rendered virtually penniless,” the Sheriff’s Department said.
In recognition of Horikawa’s efforts, going above and beyond the scope of duty, Elder Fraud Detail Detective Sgt. Brian Morris, who is investigating the case, recently presented a scroll to Horikawa before his executive peers. He was commended for protecting one of the most vulnerable members of society from victimization.
This case also underscores the importance of good working relationships with banking entities and law enforcement. The Sheriff’s Department advises the public to be aware that properly investing should be done with the assistance of a trusted and licensed financial planner who has no direct ties to the investments he/she is offering. It is very important that people do their own due diligence in investigating the authenticity of investments, and if it sounds too good to be true, it probably is.