Members of a Tokyo-based mail order firm have accused it of failing to refund their investments, industry sources said Sunday.

G. Cosmos Japan Co., located in Minato Ward in Tokyo, collected money under an investment plan from people across Japan, but has refused to refund such money since last fall, the sources said.

The members are consulting with consumer affairs bureaus about the situation, they said.

The Metropolitan Police Department is investigating the company for possible violations of the investment law.

G. Cosmos is a core company in a business group established by Japanese entrepreneur Genta Ogami. The company has some 40,000 members, according to the sources.

Under the investment plan, members are asked to pick items which they believe are likely to become hit products from mail order catalogs. They then put up a minimum of between 20,000 yen and 50,000 yen, which is used to advertise the products.

The members were initially supposed to receive dividends in accordance with profits earned by the sales of the products by mail order within a certain period, the sources said.

The company changed the system last spring, saying members are guaranteed to receive 20 percent of the amount they invested in addition to their dividends six months later.

But last October, when contracts with the members expired, G. Cosmos notified the members that it wanted to pay the dividends in 60 installments, the sources said, adding that the majority of members have not been paid since.

About 1,900 inquiries about the company were made to consumer affairs bureaus from members in all 47 prefectures between 1996 and 2001, the sources said.

One member is said to have invested about 30 million yen under the plan.

G. Cosmos continued to collect money, which it used to take over the Unitrust Development Bank in the Philippines. and to induce local people to make deposits at the bank.

The Central Bank of the Philippines did not approve the bank acquisition, which triggered a run on the bank, the sources said.

The company's business has also caused problems for people in the Philippines and Indonesia, the sources said.

"I was involved in a fraud over the acquisition of the bank and suffered about 300 million yen in losses, so we could not give refunds to our members," Ogami said.

He said the company will not go bankrupt and asked members to wait for six more months.