SEC CALLS ON PUBLIC TO JOIN FIGHT AGAINST SCAMS IN FIRST INVESTOR PROTECTION WEEK
The Securities and Exchange Commission (SEC) is rallying the public to join the fight against investment scams, as it spearheads the first Investor Protection Week from November 9 to 13.
The Commission will celebrate Investor Protection Week to promote investor education amid the rising number of unauthorized investment-taking activities, especially during the COVID-19 pandemic.
This year, the SEC has issued advisories against more than 100 groups and individuals soliciting investments without the necessary license, almost double the total number for the whole of 2019.
The Commission has likewise issued cease and desist orders and revocation orders against entities engaging in fraudulent investment schemes, including Boss Network, Forsage and Fast Track Worldwide, Inc.
The SEC has charged 32 individuals in seven cases for violations of Republic Act No. 8799, or The Securities Regulation Code, and in two cases for violations of Republic Act No. 10175, or the Cybercrime Prevention Act of 2012.
Section 8 of the Securities Regulation Code provides that securities shall not be sold or offered for sale or distributed within the Philippines, without a registration statement duly filed with and approved by the SEC.
Ponzi and pyramid schemes are among the most common types of investment fraud in the country, according to the SEC.
In a Ponzi scheme, scammers guarantee ridiculously high returns to attract more investors. They pay the promised profits to earlier investors using the money placed by newer members.
Meanwhile, pyramid schemes require members to recruit people into the group in exchange for fees. As in Ponzi schemes, they rely on new members’ contributions to pay out the promised returns to older investors.
Such schemes often deliver payouts at the start to please investors and encourage them to invite more people to join. To create a semblance of legitimacy, scammers tout products or services, which are either overpriced, worthless or inexistent.
As part of its efforts to educate the investing public and keep them falling prey to investment scams, the Commission advocated for the institution of Investor Protection Week. On November 15, 2019, President Rodrigo Roa Duterte issued Proclamation No. 846, declaring the second week of November of every year as such.
The Investor Protection Week follows the celebration of World Investor Week, a global campaign promoted by the International Organization of Securities Commissions and held in October.
“Our fight against investment scams is anchored on the public’s awareness and empowerment to spot, avoid and expose investment scams,” SEC Chairperson Emilio B. Aquino said.
“While we remain relentless in unmasking and busting investment scams, we also encourage the public to always check with SEC before entertaining any investment opportunity, especially when they are too good to be true.”
To expand the reach of its investor education programs, the Commission gathered organizations from the public and private sectors alike to form the SEC Campaign Network, which will be formally launched on November 9.
The Commission will also launch The SEC Academy, an online learning resource center developed in collaboration with the Commission on Higher Education and the Department of Education.
The SEC Academy will offer courses and learning modules for students and educators, as well as aspiring entrepreneurs and those looking to invest in securities, among others.
On November 11, the SEC will hold a webinar for high school and college students on doing business and investing safely in the Philippines. The webinar will be live-streamed on Facebook.
The Commission, together with The Philippine Stock Exchange, Inc., will also hold a corporate governance forum on November 12.
The SEC will close Investor Protection Week by recognizing its partners in promoting ease of doing business, capital market development and investor protection, as it celebrates its 84th Anniversary on November 13.
For more information, visit the official SEC Facebook page at www.facebook.com/PhilippineSEC and website at www.sec.gov.ph