San Jose Mercury
February 25, 1981 - p. 4F
Fugitive promises to blow open bank embezzlement case
LONG BEACH (AP) A spokesman for boxing promoter Harold J. Smith claimed the "Japanese Mafia" may be linked to the Wells Fargo embezzlement scandal, and said Smith plans to surface soon with documents that "will blow the case sky high."
Hilton S. Nicholson, who calls himself a "defense consultant" working with Smith's attorneys, told the Long Beach Independent Press-Telegram on Monday that Smith caught bank manager Gene Kawakami making $300,000 in unauthorized withdrawals from Muhammad Ali Professional Sports Inc. accounts last August.
Nicholson said Smith was told the money was to pay a gambling debt and that Kawakami's son had been kidnapped by the Yakuza, or "Japanese Mafia," which threatened to cut off the boy's fingers if the debt was not paid, the paper said.
Smith has said that his own son also was kidnapped and freed, and that his family has left the United States for its own safety.
Wells Fargo Bank has filed suit seeking $46.3 million in actual and punitive damages and lists Muhammad Ali Professional Sports, Smith and L. Ben Lewis, an operations officer at the bank's Beverly Hills branch, among defendants. Like Smith, Lewis has disappeared.
On Feb. 11, Kawakami was relieved of his duties at Wells Fargo, and bank officials said the action was taken in connection with the bank's investigation of the alleged embezzlement.
Kawakami has not been charged with any wrongdoing. He has not spoken to reporters since the alleged embezzlement was reported, and efforts to reach him Tuesday night showed his telephone has been disconnected.
Los Angeles police intelligence officers confirmed the Yakuza is involved in gambling, prostitution and money laundering. Police spokesman Willie Wilson said it is apparently based in Japan, with operations in the United States and elsewhere.
Smith, in earlier messages and telephone calls to reporters, claimed without explanation that the "Japanese Mafia" was involved in a fraud at the San Francisco-based bank, but Wells Fargo President Richard Cooley termed such allegations "preposterous."
The sports group paid Muhammad Ali a fee for the use of his name, but the three-time heavy-weight champion was not directly involved in its promotions.
Nicholson contended the scheme in which Kawakami allegedly was involved was similar to "check-kiting" except that it all took place within one bank.
In check-kiting, a fictitious balance is built up in one or more bank accounts by a deposit of bad checks from other banks. To work, the scheme requires careful timing.