Police on Wednesday arrested Osamu Tadokoro, former honorary chairman of health food firm Zenkoku Hachiyo Butsuryu (Hachiyo), and 13 of its former employees for allegedly defrauding investors out of some 70 million yen by promising them their money would grow within a certain period.
Tadokoro, 68, and his employees are suspected of collecting the money last December, despite knowing that Hachiyo, based in the town of Chatan, Okinawa Prefecture, would soon go under, police said.
The company had apparently collected some 160 billion yen from 50,000 investors since 1999 by way of a Ponzi scheme, in which initial investors would be expected to get their money back and more from later investors. The Tokyo District Court declared Hachiyo bankrupt on Jan. 29.