SEC warns against Crowd1

THE Securities and Exchange Commission (SEC) on Tuesday cautioned the public against investing in Crowd1 Asia Pacific Inc..

The Commission said Crowd1 neither has registered securities such as investment contracts nor has secured a secondary license to solicit and take investments from the public as required under Republic Act No. 8799, or the Securities Regulation Code.

Under its scheme, Crowd1 offers membership packages worth P6,000 to P240,000. An investor is entitled to bonuses by simply joining, sponsoring newer members and recruiting more people, SEC said.

In addition, according to SEC, Crowd1 promises residual incomes or bonuses supposedly from is digital gaming business — upon joining, a member acquires a so-called owner right, which would entitle him/her to a share in the company’s total revenues from affiliate income.

The SEC, however, noted that Crowd1 earns mainly from the recruitment of members, as in a pyramiding scheme, with most of the games touted by the group unavailable in the Philippines.

The SEC warned that those who act as salesmen, brokers, dealers or agents of a fraudulent investment schemes may be held criminally liable and penalized with a maximum fine of P5 million or imprisonment of 21 years or both under the Securities Regulation Code.

Those who invite or recruit others to join or invest in such ventures may likewise incur criminal liability, or otherwise be sanctioned or penalized accordingly, the Commission said.

It said Republic Act 11469, or the Bayanihan to Heal as One Act, further penalizes those participating in cyber incidents that make use or take advantage of the Covid-19 pandemic to prey on the public through scams, phishing, fraudulent emails, or other similar acts with two-month imprisonment or a maximum fine of P1 million or both.

The Commission said reports of unauthorized solicitation activities may be emailed to the SEC Enforcement and Investor Protection Department at epd@sec.gov.ph. (PR)