An arbitration panel of the Financial Industry Regulatory Authority has ordered a barred California broker to fork over $984,600 in damages to a client who claims the broker lost him money in a Ponzi scheme.

Steven K. Hirata, a broker formerly with PFS Investments in Fresno, was accused of breach of fiduciary duty and fraud for investing the client’s money in JMJ Capital, a Southern California firm that the Securities and Exchange Commission last October accused of misappropriating investor funds.

Hirata had been a veteran of PFS for 36 years in September 2021 when he was fired by the firm for participating in private securities transactions without notifying it, according to Finra. Hirata was later barred from the industry in May of 2022 for not cooperating with the agency’s investigation after the matter appeared on his PFS termination letter.

After a proceeding that started last year, ex-client Richard A. Davidson was awarded the damages this week.

“The award was the result of a default proceeding, as Mr. Hirata … chose not to participate in the arbitration process,” said Jeffrey A. Feldman, Davidson’s attorney, in an email interview.

Davidson had filed a complaint with Finra arbitrators in early 2022. Specifically, he charged Hirata with breach of fiduciary duty, fraud and elder abuse under California law, among other technical violations, all related to JMJ Capital. Davidson wanted reimbursement of his funds—which amounted to $1.4 million, he claimed—along with punitive damages, reimbursement for emotional distress, funds to pay attorney fees and incidentals.

Last week, the Finra arbitration panel awarded Davidson $984,600 in compensatory damages plus costs related to the arbitration, which Hirata officially accepted in writing.

It was less than originally sought, but Davidson agreed. He had “requested a reasonable amount to be awarded against Mr. Hirata, and this is what the arbitrator awarded,” said Feldman. “Whether Mr. Davidson will ever be able to collect a dime from Mr. Hirata is another story altogether.”

The SEC filed fraud charges against JMJ Capital in October 2022, saying the firm and its president, Richard Lee Ramirez, fraudulently raised $5.8 million dollars from 2019 to 2021, promising investors 25% to 30% monthly returns for various business lines, including the importation of personal protective equipment during the Covid-19 crisis. “Instead, Ramirez spent investor funds on his own lavish lifestyle and to make Ponzi-like payments to investors,” the SEC claimed in its filing in the U.S. District Court for the Southern District of California.