In what could be an interesting theme for an episode of "Hawaii Five-0," the Securities and Exchange Commission has brought fraud charges against a Honolulu woman who posed as an investment banker and solicited some $250,000 from investors through Twitter, Facebook and other social media, as well as Skype.
"As alleged in our case, [Keiko] Kawamura used social media to ensnare investors and raise money to support her lifestyle," said Michele Wein Layne, director of the SEC's Los Angeles Regional Office, in a press release shared last week. "Investors should beware of fraudsters who use social media to hide behind anonymity and reach many investors with little to no cost or effort."
The SEC found the 27-year-old presented herself as "an investment and hedge fund expert" with Kawamura Financial, though she had no prior trading experience. She conducted this scheme from December 2011 through June 2012, when she raised about $200,000 from at least seven investors for an investment program that had a purported performance fee of 20 percent of profits.
In the first scheme, she posted screenshots of brokerage account statements on Twitter and suggested she had produced "incredible investment returns" with her hedge fund, regulators say. The account statements, though, were not hers, and she spent money obtained from investors on living expenses and luxury trips to Miami and London, as well as on options she invested in and "lost everything."
In another scheme, Kawamura set up a subscription service for investment advice and "falsely told subscribers that she had been in the investment-banking industry for nearly a decade and had achieved 800 percent returns in her personal brokerage account," according to the SEC.
This scheme took place from August 2012 to February 2014, when Kawamura made some $50,000 from about 70 individuals via her website, which charged monthly fees.
See also: Twitter compliance do's and don'ts
Regulators have yet to determine any remedial action or financial penalties in their case against Kawamura.
Super social
Kawamura used her Twitter account to post screenshots of portions of a brokerage account and attract followers.
