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Mail order firm raided on suspicion of bilking investors before going bankrupt

Metropolitan Police Department investigators bring evidence boxes into Kefir Inc.'s headquarters in Tokyo's Chiyoda Ward on Feb. 6, 2019. (Mainichi/Kazuki Sakuma)
Metropolitan Police Department investigators enter the Kefir Inc. headquarters building in Tokyo's Chiyoda Ward on Feb. 6, 2019. (Mainichi/Kazuki Sakuma)

TOKYO -- A mail order company here has been raided on suspicion of illegally soliciting investment in its food products from customers until shortly before going under, law enforcers said.

The Metropolitan Police Department (MPD) searched the headquarters of Kefir Inc. on Feb. 6 in Tokyo's Chiyoda Ward for allegedly violating the Act Regulating the Receipt of Contributions, Receipt of Deposits and Interest Rates. The victims apparently suffered enormous losses, and MPD investigators will analyze confiscated company documents to get to the bottom of the scheme. Kefir is currently in bankruptcy.

The company's debts total some 100 billion yen owed to about 30,000 people, according to a legal team for victims. Most of the victims are investors -- called "owners" of processed food produced by the company.

Kefir was founded in 1992 as a manufacturer of kefir yogurt bacteria, and was also selling mail order processed food products.

Kefir Inc. brochures are seen in this file photo taken in Tokyo's Chiyoda Ward on Aug. 28, 2018. (Mainichi/Reiko Oka)

About a decade ago, the company began soliciting consumers to become "owners" of processed food products manufactured by subsidiaries and other entities. Under the system, a person invested 50,000 yen per unit and became a food product "owner." The firm returned the principal plus interest by purchasing the products after a certain period.

However, Kefir began to fall behind on its payments sometime around November 2017, and went under in September 2018. The Tokyo District Court subsequently began bankruptcy procedures for the company.

According to those familiar with the investigation, the company is suspected of collecting at least around 3.1 million yen from four customers, including a 68-year-old woman living in Yokohama, south of Tokyo, between Feb. 28 and June 27 last year by guaranteeing principal investments. By that time, however, the company was apparently already in financial difficulty.

Kefir solicited investors until shortly before going under last September, leading investigators to suspect that the company was desperately collecting money to repay its snowballing debts.

The victims' legal team told a Feb. 6 news conference in Tokyo that many of the victims are elderly women. Many of them were originally the company's mail order customers and were later solicited to invest in food products.

A woman in her 70s who lost 11.6 million yen to the scheme commented, "I feel a lot of regret, but I just can't leave things as they are. I'd like police to confirm what happened here."

(Japanese original by Ikuko Ando and Kazuki Sakuma, City News Department; and Reiko Oka, Lifestyle News Department)

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