A federal judge in Hawaii has ruled that a man who defrauded about 125 deaf people in a Ponzi scheme based in Honolulu must pay $6 million in restitution and penalties.
Marvin Ray Cooper, who is also deaf, solicited $4.4 million from people in the U.S. and Japan through his business, Billion Coupons Investment, which was also based on Oahu.
U.S. District Judge Michael Seabright ordered Cooper on Aug. 26 to pay $4 million in restitution and interest and $2.4 million in civil penalties to the Securities and Exchange Commission and U.S. Commodity Futures Trading Commission.
Cooper could not be reached for comment. A woman who knows Cooper said she believes he is still in Honolulu.
According to court documents, the scheme began about September 2007.
Cooper, who is in his mid-30s, promised customers a monthly return of 15 to 25 percent in the foreign exchange market, based on the amount of the customer’s investment, and represented the investment as low risk.
He attracted members of the public to trade through BCI, using BCI employees and agents, the company websites and live seminars.
Many agents who helped draw in new customers were also investing funds with BCI, documents said.
Some of those who fell for the scheme took out home equity loans and ran up debt on credit cards.
Documents said Cooper paid customers using investments from new customers, constituting a Ponzi scheme.
He perpetuated his scheme by giving customers false statements, showing their accounts increased by 25 percent, while they were actually losing money every month.
Cooper only put $1.7 million into the market and lost $749,000, documents said. He used $1.4 million as his "piggy bank" to buy personal items such as computer and electronic equipment, flying lessons, and a $1 million home, documents said.
Documents said Cooper was the chief executive officer and sole owner, director and trader of Billion Coupons Investment, a corporation formed in Hawaii on Jan. 11, 2007, with offices at 778 Wiliwili St. in McCully and 835 6th Ave. in Kaimuki. Its website, billioncoupons.com expired last month. Cooper was also the signer of BCI’s bank account.
About $1.5 million was returned to customers as purported profits and paid as commissions to its employees and agents.