PHI SEC Investment Scams

• Continues to intensify efforts in protecting investing public from fraudulent schemes and abuses through its all-out campaign against various forms of investment scams.

Warrants

• As part of this all-out campaign, a total of 24 search warrants were implemented in connection with the investment-taking activities of six entities in violation of rules.
• The combined teams of the SEC and the National Bureau of Investigation and
  Philippine National Police-Criminal Investigation and Detection Group were involved.
• On the offices of Rigen Marketing in Tagum City, Ada Farm Agriventures in Mandaue, Cebu and Ever Arm Any Marketing in Tagum City on Jun. 11 as per search warrants.
• Also searched the offices of Organico Agribusiness Ventures Corp. in Cebu City, Bohol, Tacloban City, Davao City and Butuan and Alabel-Maasim Small Scale Mining Coop.
• Similar operations were carried out at the offices of Kapa-Community Ministry Intl.

Evidence

• The raiding teams were able to seize large numbers of documents/cash together with other equipment and paraphernalia used by scammers in enticing investors to invest.
• Despite not having necessary license or permit for investment-activities/securities sales.
• Evidence gathered by the SEC indubitably shows that the entities were scam operators who were offering “get rich quick” schemes to the public attracted by the huge profits.
• In the case of Kapa, it was established that it was selling or offering a scheme in which “donations” given are rewarded with “blessings” amounting to a 30% monthly return.
• With the evidence gathered, the SEC is poised to file criminal charges against the
  operators, owners, agents, officers and directors of said entities.

Enforcement

• Prior to the implementation of the search warrants, SEC has flagged the unauthorized investment-taking activities of Kapa, Rigen, Organico, ALMAMICO/ALAMCCO, Ada Farm.
• Such activities constituted the sale and offering of securities in the form of investment contracts, which required a secondary license from the Commission.
• Worse, the groups employed a Ponzi scheme or an investment program where investors are lured with impossibly high returns, paid out of capital contributed by later investors.
• SEC recently issued separate cease and desist orders against Organico, Ada Farm and Ever Arm along with their partners, officers, agents, representatives, assigns, others.
• Also ordered the groups to cease from promoting their investment schemes through internet and/or remove promotional presentations from their websites immediately.
• In the interest of investors, the SEC further barred the groups from transacting any business involving the funds in their depositary banks and from transferring/disposing.
• Meanwhile, the Commission earlier revoked registration of Kapa and is now preparing criminal charges against Kapa and all persons involved in fraudulent investment scheme.

Warnings

• Reiterated its warning against any and all persons acting for and in behalf of groups engaged in such fraudulent activities amid intensified crackdown on investment scams.
• Those acting as salesman, broker or agent may be prosecuted and held criminally liable.
• They may also face a maximum fine of P5 million or imprisonment of 21 years or both.
• Those who sell or offer securities to the public may likewise be held criminally liable or accordingly sanctioned or penalized pursuant to the decision of the Supreme Court.
• Furthermore, the names of all those involved will be reported to the Bureau of Internal Revenue so that the appropriate penalties and/or taxes be correspondingly assessed.
• Chairperson Aquino warned there will be no letup in campaign against scam operators, as the SEC is poised to file criminal charges and run after the officers, directors, agents.