HONOLULU STOCK BROKER SENTENCED FOR FRAUD

by Christopher J. Gray on September 5, 2011

in Morgan Stanley,Securities Fraud

Ryan Kimura, a former Morgan Stanley Dean Witter stockbroker in Honolulu, Hawaii, was sentenced to 57 months in prison. In addition, he will pay $1.5 million to Morgan Stanley and over $500,000 plus interest to the Internal Revenue Service. Payment to the IRS will cover tax losses from 2000-2007. Kimura was charged with money laundering, bank fraud, wire fraud and filing a federal tax return that was incorrect.

Honolulu stock broker sentenced for fraud

Kimura was previously barred from associating with any member of FINRA in 2009. Kimura worked with Morgan Stanley until May 2006 and then with Sun Life Financial Distributors until December 2007.

Kimura’s former wife’s mother, her grandmother, her sister, her father and her father’s company were all victims of his fraud. Kimura took money from his father-in-law’s Japan-based company without permission and subsequently lost around $360,000 trading its stock. He also forged signatures on 206 checks, stealing a total of $1.5 million through these forgeries.

This federal court decision did not involve any restitution to his in-laws because that situation had already been resolved. According to Morgan Stanley, Kimura’s fraud was not discovered until after his 2006 resignation. When his broker misconduct was discovered in 2007, an investigation was initiated by Morgan Stanley and, together with the authorities, they “amicably resolved this matter with Mr. Kimura’s wife’s family.” The Morgan Stanley spokesperson went on to say, “We are pleased that the court had ordered Mr. Kimura to make restitution to Morgan Stanley for his deplorable misconduct and that justice has been done in this case.”

Kimura, 42, pleaded guilty to the charges in April. In addition to the 57 months in prison, he will serve nine years probation. Of this case, IRS special agent in charge of the Pacific Northwest, Marcus Williams, said, “when a wayward broker embezzles money from unknowing victims, forges signatures on checks, and then cheats on his taxes, that broker can expect to be prosecuted and sent to prison.”

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