Friday, April 26, 1996 | 11:59 a.m.
Two Las Vegas men have been arrested on charges of trying to sell a questionable $500 million Japanese war bond.
The men -- a political consultant and a Japanese businessman -- are accused of helping Motokichi Muto, who claims to be a former Japanese government official and ambassador to Mexico, sell the bond.
Businessman Yjui Hitomi, a 48-year-old Japanese national, was released from custody Thursday on his personal recognizance. Douglas Wright was released under similar conditions last week.
They will travel to Columbia, S.C., where they will be prosecuted on charges of wire fraud and conspiracy to commit fraud.
Among those who may testify against the Las Vegans is former Rep. James Bilbray, a Democrat who lost his seat to Republican Rep. John Ensign in 1994. Other potential witnesses include high-ranking Japanese officials.
Prosecutor Dean Eichelberger said that while Bilbray was in office, Wright allegedly asked the congressmen to extend the visa for one of the Japanese businessmen.
Bilbray was never a target of the investigation, the assistant U.S. attorney stressed.
The defendants are accused of trying to sell the bond in 1993 for 25 percent of the face value, or $125 million. The note, worth 50 billion Japanese yen or $500 million, allegedly was to mature in 1998.
But the defendants believed that the bond, issued in 1947 and reissued in 1957 as part of Japanese government reconstruction efforts following World War II, was authentic, a South Carolina defense lawyer told the State newspaper in Columbia.
The State reported that the FBI learned of the sale when a stockbroker told agents about a flier from Global Treasurers Limited of Nevada advertising the war bond. Wright allegedly acted as a broker for Muto and Hitomi in the bond deal, the newspaper said.
As part of the alleged scheme, Muto is accused of claiming to use his connections in the Japanese government to help the bond's purchaser to collect the $500 million once it matured.
Charges originally were filed in 1993, the same year the Japanese government warned people about fraudulent bonds that had surfaced throughout the world.
But shortly before trial, Muto fled the United States. Rather than prosecute only Hitomi and Wright, the U.S. attorney's office dismissed the charges with the understanding that it could reindict once Muto was arrested.
Late last year, Muto was extradited back to the United States, and new arrest warrants were issued for Hitomi and Wright.
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