12 more firms under SEC watchlist


BAGUIO CITY  – Twelve more firms reportedly enticing the public to investment their hard earned money in exchange for skyrocketing interests for a short period of time have been placed under the watchlist of the Securities and Exchange Commission (SEC) for their alleged involvement in Ponzi schemes.

Lawyer Annie Gonzales Tesoro, director of the SEC Baguio extension office, said the twelve companies were not registered with the SEC and were not authorized to solicit funds from the public in the guise of investments in exchange for lucrative interests that seem not to be true because the companies are not engaged in a business that would warrant the offering of high interests.

Tesoro identified the ten companies reportedly involved in ponzi schemes and with branches in the different parts of the region as United Wellness Hub, Unlimited Wellness Hub, PC Wellness, DLC, FKC International, Supreme Unlimited Network, Swiss Golden Ads-Hub.Com, Infinitwealth Touchstone,  Receinte International, Wisdom Express Wealth Trading and Marketing and Green  Wealth Gold.

Ironically, she claimed the United Wellness Hub had already closed its operations and investors had sought the assistance of law enforcers to facilitate the filing of charges against the owners for them to be able to recover their huge investments.

“While it is true that an entity is registered with SEC, it is not true that the scheme or modos it is practicing is allowed by law since it must pass through sufficient scrutiny by experts whether their schemes are viable or not,” Tesoro stressed.

She disclosed the names of the companies involved in alleged Ponzi schemes were taken from the testimonies of individuals who sought the assistance of law enforcers verifying the validity of their operations.

However, the SEC official added the agency is currently validating whether or not the companies are registered with the Department of Trade and Industry (DTI) considering that their inquiry was already referred to the DTI central office for approval.

It was learned one of the companies is offering their clients double their money in 45 days considering that an investment of P40,000 will become P90,000 after the said period.

She cited the companies involved in soliciting securities from the public without the benefit of a license from the agency do not even have products or services to offer in order to justify the grant of attractive interests that lure the public to place their hard earned money for such dangerous scheme.

Tesoro appealed to the public to be careful in investing their hard earned money to such Ponzi schemes because the SEC had already done its part to inform them about when and where to place their investments, thus, they should not be blamed if they stand to loose their money to such investment scheme.

Earlier, the SEC recently issued another warning to the public against various individuals and corporations in the city who are soliciting investments from the people to sustain and maintain their operations that are covered with alleged Ponzi schemes.

Tesoro said the public must take into consideration eight reminders before investing in the operation of individuals and corporations to prevent them from being divested of their hard earned money.

“A Ponzi scheme is a type of investment fraud wherein an operator promises high financial returns that are not expected from traditional investments.  Instead of investing the victims’ funds, the operator pays the original investors with the money given by subsequent investors.  Usually, enough money is returned to the original few investors to make them believe that profits are actually realized.  These original investors then are expected to “recruit” new investors, with their testimonials that they have indeed received their “profit,” Tesoro stressed.

She said some of the features of Ponzi investment schemes are that the individual or corporation has No SEC Registration, or with SEC Registration but NO secondary license to act as broker or dealer in securities; the individual or corporation Offers or guarantees a huge profit in a very short period and the individual or corporation Utilizes a binary network (i.e. upline and downline) to earn commissions.

Furthermore, Ponzi investment schemes are also characterized by a Provision for a lock-up period where an investor cannot touch the investment (i.e. 60 days); Assures pay-off of investments in a short time; Uses high pressure methods to convince investors to reinvest their earnings; Unknown principal office, address, founders, directors or officers and Orientation seminars are conducted informally.

“These investment schemes ordinarily collapse as fast as they are created while leaving its investors behind and unable to recoup their investments,” Tesoro added.

She explained a company engaging in a Ponzi scheme is engaged in unauthorized offering, solicitation and placement of investments from the general public without the necessary license.

According to her an entity may show the public a registration certificate from the SEC or the DTI, but this certificate of registration is not the authority of these entities to engage in the unauthorized selling of securities.

“Securities are shares, participation or interests in a corporation or in a commercial enterprise or profit-making venture and evidenced by a certificate, contract, instrument, whether written or electronic in character.  The essential trait of a security is that it is a participation in a profit-making venture with various elements,” she said.

She disclosed the elements are an investment of money, in a common enterprise, with an expectation of profits and primarily from efforts of others.

Tesoro appealed to the public t report any offer of investment made by persons or entities using similar modus operandi to the SEC for appropriate enforcement actions.

It can be recalled that numerous concerned citizens from the different provinces in the Cordillera had been inquiring from the website of Herald Express on the legality of the operation of some companies operating in their places that collect from the people huge investments in exchange for huge interests among others.

By Dexter A. See