Honolulu financial adviser Mark K. Teruya got more bad news yesterday when the state said it was immediately suspending his license to sell insurance and that it would seek a permanent revocation of the license for allegedly defrauding an elderly client.

The state Insurance Division said Teruya, president of Senior Resources of Hawaii Inc., a company that does business as USA Wealth Resources, accessed an 82-year-old client's account without permission and transferred more than $100,000 from one insurer to another. The division said it is continuing its investigation and that other announcements may be forthcoming.

The suspension followed an action Friday by the state Securities Commissioner's Office and the U.S. Securities and Exchange Commission, both of which alleged Teruya exploited elderly customers for his personal gain. The SEC complaint charged Teruya and others had violated anti-fraud laws and asked for restitution and civil penalties.

The state also issued a preliminary order and asked Teruya to cease and desist with his activities, which included inviting elderly citizens to free lunch seminars. The cease-and-desist order said the state is looking at cases involving 19 victims and involves more than $5 million.

Yesterday, Teruya's Manhattan Beach, Calif., attorney, Irving Einhorn, said the complaints stemmed from a few unhappy clients and that clients were fully briefed during meetings. He said Teruya would vigorously deny the allegations.

"This is one of the nicest guys, one of the most straight-shooting guys you'll ever meet," Einhorn said, noting Teruya had hundreds of satisfied clients and that the SEC was only trying to make Teruya a "poster boy."

The SEC complaint claims Teruya misled clients into signing blank forms on multiple occasions without disclosing their purpose and use.

The suit alleges Teruya later used the forms to sell seniors' stocks and bonds without their knowledge and used the proceeds to purchase equity-indexed annuities for which he received commissions totaling about $2 million.

Einhorn said some of the complaints were filed at the urging of clients' former brokers, who didn't like Teruya taking away their business. He said none of the clients has lost any money and that the money had been placed in annuities in which the principal is always preserved.

"Anytime people have wanted some money back, they've gotten their money back," Einhorn said.

The state Insurance Division alleged Teruya had committed deceptive acts and fraud with the case of the 82 year-old, including getting the senior citizen to sign forms that gave Teruya access to the person's financial institution.

"The division believes that Mr. Teruya's actions in this case violated the Insurance Code and negatively impacted the senior citizen," said Gordon Ito, chief deputy insurance commissioner, in a statement.

"The division places great importance on the protection of senior citizens from insurance producers who prey on them."

Reach Greg Wiles at gwiles@honoluluadvertiser.com.