Tokyo police on Wednesday arrested two former executives of the parent firm of a housing renovation company involved in fraudulent home repairs that mostly targeted elderly people.
The suspects, arrested on fraud allegations, were identified as Takayuki Shirakura, 26, and Mitsutoshi Sugaya, 33. Both are former executives of M.H.S., the parent of Samnin East Co.
Samnin East salesmen are suspected of approaching people and persuading them into costly renovations of their homes that were excessive or even unnecessary.
It is the first time people linked to the parent firm have been arrested in connection with the scams.
The Metropolitan Police Department said it suspects M.H.S. masterminded the heavy-handed sales pitches and will probe whether it was systematically involved in the swindles.
An investigation determined that in one incident, Shirakura defrauded a 46-year-old Yokohama man out of 1.17 million yen in January 2002 after having him sign a contract for home repairs. He lied to the man that one of the structure's main pillars was warped and the house would collapse in an earthquake, police said.
Sugaya, for his part, bilked a 64-year-old man in Abiko, Chiba Prefecture, out of some 2.24 million yen in July 2001.
Both reportedly held the title of "general manager of sales of the Samnin group."
Five people, including salesmen for Samnin East, have so far been charged in connection with the scams.