His name likely will be remembered infamously for running a $1.5 billion Ponzi scheme in Las Vegas, but
Ed Fujinaga also made a pretty big impression in
Honolulu, where he developed several condominium towers.
Edwin Yoshihiro Fujinaga, 72, was convicted in a
federal court in Nevada
last month for scamming
investors through a Las
Vegas-based company,
MRI International Inc., he
established in 1998.
Before setting up MRI,
Fujinaga spent about two
decades in Hawaii’s real estate industry, developing at least seven condo towers
on Oahu in the 1970s and 1980s, often with partners.
Among his projects were two towers in Waikiki now known as Maile Sky Court and The Windsor, The Summer Palace near the edge
of Waikiki off Atkinson Boulevard, Harbour Ridge fronting Salt Lake Boulevard, Sun Hala and Summer Villa in Kapahulu and Hale O Pumehana in Makiki.
Fujinaga appears to have gotten his start with a real estate sales license in 1973 working for Budget Realty, led by local developer Richard Mew.
Budget Realty in some cases was the sales firm representing Fujinaga’s projects, and in at least two cases the company or Mew was Fujinaga’s partner, according to state Real Estate Commission reports. Fujinaga also started his own firm, In-Sites Realty Ltd. with then-wife Andrea Fujinaga, who filed for divorce in 2000.
As with the financially risky condo development business in general, not all
of Fujinaga’s projects were successful.
The Windsor, which was originally called Waikiki
Hobron and operated as a condo-hotel, and the Maile Sky Court, which also operated as a condo-hotel and was known under previous names Maile Court and Waikiki Mandarin, were lost to foreclosure in the mid-1980s shortly after they
were completed.
Waikiki Hobron, completed in 1984, may have been Fujinaga’s last project in Hawaii, though because he formed unique names for each project it isn’t easy to know from public records whether he developed other buildings. His firm In-Sites Realty was dissolved in 1994 after changing its name in 1989 to Pacifica Resorts Inc.
Fujinaga could be described as a major Hawaii condo developer when he was active, though beyond that it was hard to say what kind of businessman he
was here. A former Fujinaga associate in Hawaii declined to talk about the former
developer.
In Las Vegas, Fujinaga
was described by the U.S. Department of Justice as living a lavish lifestyle that included ownership of a private jet, luxury cars with Bentley, McLaren and Bugatti nameplates, a Las
Vegas mansion and homes
in California wine country and Beverly Hills.
Fujinaga also owned a home and a ranch in Hawaii, according to government
filings.
Such wealth was built, government authorities contended, with money from investors primarily in Japan but also in Canada, Malaysia and New Zealand who thought they were investing in unpaid medical bills that MRI would buy from health-care facilities at a discount before trying to collect from insurance companies.
Instead, according to the Justice Department, Fujinaga spent less than 2 percent of investor funds to purchase medical claims. The U.S.
Securities and Exchange Commission believes MRI stopped buying such bills, known as medical accounts receivable, in 2008 and used new investor contributions to pay returns to earlier investors and to enrich Fujinaga.
In 2013, the Japanese
government revoked MRI’s license to sell securities, and that led to enforcement action in Japan and the United States.
“Edwin Yoshihiro Fujinaga and MRI International Inc. perpetrated an extensive and egregious Ponzi scheme that victimized thousands of investors, depriving many of their entire life savings,” the SEC said in a 2013 complaint.
The Justice Department said MRI owed investors,
including over 10,000 Japanese residents, more than $1.5 billion in 2013. Government officials laid claim to Fujinaga assets in an effort to recover some investor losses. Last year, a receiver sold a Hawaii island ranch Fujinaga bought in 2004 and recovered $1.8 million. Government officials also have said Fujinaga owns a home in Hawaii but declined to disclose details of that asset.
On Nov. 27 after a five-week trial in a federal criminal case, it took a jury less than three hours to find
Fujinaga guilty of nine counts of wire fraud, three counts of money laundering and eight counts of mail fraud in connection with the Ponzi scheme. His sentencing is set for March 8. The Associated Press said he faces up to 370 years in prison.