SEC warns public against KAPA’s false claims

Robie de Guzman   •   August 28, 2019   •   1481

MANILA, Philippines – The Securities and Exchange Commission is urging the public to exercise more caution and discernment amid disinformation campaigns being launched by investment scammers.

In a statement, the SEC particularly noted the false claims by Kapa-Community Ministry International (KAPA) on social media. Supposedly, the group was poised to secure the necessary licenses to resume its operations.

The commission said that recently, KAPA falsely claimed that the Bangko Sentral ng Pilipinas (BSP) released a statement purportedly approving its investment scheme and questioning delays on the part of the SEC.

The Central Bank has refuted such claim in a statement.

KAPA also falsely claimed that it already filed with the SEC an application for a secondary license to sell and offer for sale securities to the public.

But the commission said it has not received any application for a secondary license from KAPA, as verified by the SEC Company Registration and Monitoring Department (CRMD).

“Besides, KAPA does not have a juridical personality to make such application,” it said.

On April 3, the SEC revoked KAPA’s certificate of incorporation for serious misrepresentation of what it could do or was doing to the great prejudice of or damage to the general public.

“KAPA, formerly registered with the SEC as a nonstock corporation, had solicited investments from the public without securing a secondary license first. Worse, the group had employed a Ponzi scheme,” the commission said.

Under its scheme, the SEC said KAPA enticed the public to “donate” P10,000 in exchange for a 30% monthly “blessing” or “love gift” for life, without having to do anything other than shell out money and wait for the promised payout.

Section 8 of Republic Act No. 8799, or the Securities Regulation Code, provides that “securities shall not be sold or offered for sale or distribution within the Philippines, without a registration statement duly filed with and approved by the Commission.”

Section 26 of the same Code further prohibits fraudulent transactions, including Ponzi schemes where investors are lured with impossibly high returns and paid using money contributed by other investors

Section 28 further states that no person shall engage in the business of buying or selling securities in the Philippines as a broker or dealer, or act as a salesman, or an associated person of any broker or dealer unless registered with the SEC.

In this light, the SEC said that 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, under the Securities Regulation Code.

On June 18, the commission filed a criminal complaint against KAPA, its founder and president Joel A. Apolinario, trustee Margie A. Danao, corporate secretary Reyna L. Apolinario and other promoters of the investment scam.

“We enjoin the investing public to be more discerning with and critical of any promises and persuasions made by fraudsters,” SEC Chairperson Emilio B. Aquino said.

“When presented an investment opportunity, take time to verify the legitimacy of the company, especially their authority to solicit investments from the public, and to understand how the promised returns will be generated and delivered.”

The commission advised those who have invested money in KAPA to file complaints with the SEC Enforcement and Investor Protection Department at Secretariat Building, PICC Complex, Roxas Boulevard, Pasay City with telephone numbers (02) 818-6337 and (02) 818-5324.

Affected investors may also visit the SEC Davao City Extension Office at SDC Building, Purok 13, Maa Road, Maa, Davao City; call (082) 298-2170 and (082) 298- 1893; or email kjpestares@sec.gov.ph. In Cagayan de Oro City, they may visit the Commission at SEC Building, corner 14th and Tomasco Del Lara Street; call (088) 857-4325 and (088) 857-7225; or email rvegypto@sec.gov.ph.

SEC to adopt zero face-to-face transaction policy amid COVID-19 case spike

Robie de Guzman   •   January 13, 2022

 

MANILA, Philippines — The Securities and Exchange Commission (SEC) announced it will be implementing a zero face-to-face transaction policy in its offices in Metro Manila starting Thursday, January 13.

In a notice issued on January 11, the SEC said the policy will be enforced in its main office within the PICC Complex in Pasay City and former headquarters along EDSA in Mandaluyong City, in  view of the fresh surge in COVID-19 cases in the region.

The policy will be in effect “until further notice.”

The commission said all applications for company registration, submissions of reportorial requirements, and other transactions will be accepted and processed through its online portals, email, courier and other remote means.

The SEC said it will maintain a skeleton workforce and implement other alternative work arrangements to ensure uninterrupted delivery of services despite the adjustments in its operations.

It advised the public to contact their hotline numbers or the concerned departments provided here for queries and other concerns.

SEC issues moratorium on registration of online lending platforms

Robie de Guzman   •   November 5, 2021

The Securities and Exchange Commission (SEC) said it has imposed a moratorium on the registration of new online lending platforms (OLP) of financing and lending companies.

In a statement, the SEC said the moratorium takes effect on Friday, November 5.

The commission on November 2 issued SEC Memorandum Circular No. 10, Series of 2021, which provides for the Moratorium on New Online Lending Platforms, ahead of the release of new rules that will govern the licensing and registration of the OLPs of financing and lending companies.

“We are currently crafting new guidelines that will allow lending and financing companies to better address the needs of borrowers and, at the same time, plug loopholes that give rise to abusive and predatory practices,” SEC Chairperson Emilio Aquino said in the same statement.

“We have seen the emergence of financial technology companies that engage in predatory lending, taking advantage of those struggling financially during the pandemic. The Commission will work toward stamping out these abusive financing and lending companies that do nothing but bury borrowers in even more debt,” he added.

The SEC said that OLPs that have been recorded prior to the moratorium, may continue to operate and be used for online lending or financing.

“The Commission will subject the existing OLPs to strict monitoring, audit and review to ensure their compliance with all applicable laws, rules, and regulations,” it added.

To date, the SEC has cancelled the licenses of 35 financing/lending companies due to various violations of applicable rules and regulations.

The commission also said that it has revoked the certificate of registration of a total of 2,081 lending companies for their failure to secure the requisite certificate of authority, pursuant to Republic Act No. 9474, or the Lending Company Regulation Act of 2007.

At least 58 online lending applications have likewise been ordered to cease operations for lack of authority to operate as a lending or financing company, the SEC said.

 

Court orders arrest of KAPA Ministry founder, execs for fraud raps

Robie de Guzman   •   February 12, 2020

KAPA Ministry founder Joel Apolinario

MANILA, Philippines – A court in Bislig City, Surigao del Sur has ordered the arrest of Kapa Community Ministry International Inc. founder and other group executives on charges of investment fraud, the Securities and Exchange Commission (SEC) said Wednesday.

The Bislig City Regional Trial Court Branch 29 on February 11 issued warrants of arrest against Kapa founder and president Joel Apolinario, trustee Margie Danao and Corporate Secretary Reyna Apolinario along with promoter Marisol Diaz, Adelfa Fernandico, Moises Mopia and Reniones Catubigan.

In a statement, the SEC said the warrants of arrest were issued after prosecutors at the Department of Justice filed criminal charges against the group for violations of Republic Act 8799 or the Securities Regulation Code.

State prosecutors accused Kapa of “willfully, unlawfully and criminally” engaging in the selling or offering for sale or distribution of securities in the Philippines without a registration statement duly filed with and approved by the SEC. Kapa officials were also accused of promoting the investment scam.

In April 2019, the SEC revoked KAPA’s certificate of incorporation for serious misrepresentation of what it could do or was doing to the great prejudice of or damage to the general public.

Under its scheme, KAPA enticed the public to “donate” P10,000 in exchange for a 30% monthly “blessing” or “love gift” for life, without having to do anything other than shell out money and wait for the promised payout.

In June last year, the commission filed a criminal complaint against KAPA, for employing a Ponzi scheme, an investment program that offers impossibly high returns and pays investors using the money contributed by later investors.

In the same month, the SEC secured a freeze order from the Court of Appeals covering all bank funds and assets linked to the group.

Separate warrants of arrest against Fernandico and Mopia were issued by the Quezon City Regional Trial Court.

The SEC also reminded the public to exercise more caution and discernment as certain supporters and promoters of KAPA peddled false information about the group’s supposed revival.

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