Financial Smooth Operators!

Kazutsugi Nami - Japan's Bernie Madoff

The current financial crisis hitting the globe has unravelled yet another financial scam - this time in Japan. Kazutsugi Nami, chairman of a now-bankrupt bedding company, L&G (Ladies & Gentlemen!) has scammed about 37 thousand investors of US$1.4 billion in the biggest ever pyramid scheme with promises of building a paradise on Earth for investors, some of whom called him "divine".

Nami wooed his so-called 'shareholders' by building a cult-like status, saying he had a 'divine decree' to 'eliminate poverty from this world'. Nami was so charismatic that investors worshipped a 'Nami cult'. Investors were promised annual returns on investments of 36%! Most of the victims were housewives and elderly investors, some of whom risked all of their retirement savings.

For investments of 100,000 Yen and above, Nami introduced a virtual currency called enten (divine yen) that could be loaded on to mobile phones and used to purchase items from an Internet site. However, in 2007, the Company informed all investors that their investments would be converted to enten and this led to a deluge of requests to cancel contracts and even lawsuits demanding the return of principal investments.

The parallel between Nami and Bernie Madoff? They were both smooth operators, they moved in the higher echelons of society and they wiped off dreams of gullible investors!