By NITZ ARANCON and LITO RULONA, Correspondents .
Securities and Exchange Commission en banc on Friday issued a Cease and Desist Order (CDO) against Ministry Kapa-Community International for operating a “ponzi scheme” in the region and nearby provinces in Mindanao area.
The order was issued by the SEC in banc on February 14, 2019, signed by SEC Chairman Emilio Aquino, and SEC Commissioners Antonieta Ibe, Kelvin Lester Lee, Ephyro Amatong and Javey Paul Francisco.
The 15 pages order even ordered Kapa Community Ministry International Inc., to stop their dealings with people, to include by offering their investment contract, asking donations and other illegal transactions.
Aquino, and SEC commissioners also included in the order were Kapa-Co Convenience Store and General Merchandise, Kapa-Worldwide Ministry, Mr. Joel Apolinario and his partner associates, such as their directors, agents, representatives conduits, and other people, who represent members of the team.
“The subject entities and individuals are directed to cease from promoting its investment scheme through the internet and/or delete or remove immediately the promotional presentation of such investment scheme from the websites” SEC in banc said.
“Moreover, to forestall grave damage and prejudice to all concerned and to ensure the presentation of the assets for the benefits of the investors, respondent or any of their representatives, or any person/s acting for and in their behalf, and such other persons directing or controlling the activities of such corporations, officers, representatives, salesmen and agents, are all ENJOINED from. (a) Transacting any and all business involving the funds in its depository bank (b) From transacting, disposing or conveying in any other manner and any all asserts, properties, real or personal, and including bank deposits, if any, of which the name persons herein may have any interest, claim or participation whatsoever, whether directly or indirectly, under their custody, immediately upon receipt of this order, until further orders from this commission” it said.
The SEC in banc, also directed the Enforcement and Investor Protection Department, EIPD, to serve the order to the Kapa Community International Inc., to its president, general manager, corporate secretary, treasurer, in-house counsel or partners and by posting copies of the Order at the entrance of the main office and or branches, if any, of Kapa Community International Inc.
Meanwhile, SEC-10 regional director lawyer Rene Egypto said the result of the investigation issued by the EIPD has substantial evidence to support the allegation that KAPA and its allied entities are engaged in offering or selling to the public securities in the form of investment contracts without the necessary license from the Commission.
The revocation of the SEC permit is addressed to Pastor Josel Apolinario, President and Chairman of the Board of Directors of Kapa-Community Ministry International, Inc.; Mr. Ricky Taer, Member of the Board of Directors of Kapa-Community Ministry International, Inc.;
Reyna Apolinario Corporate Secretary and Member of the Board of Directors of Kapa-Community Ministry International, Inc.; Kapa Board of Directors like Mr. Joji A. Jusay; Modie Dagala; Margie Danao; and Benigno Tipan. Jr.,:
“In a plethora of cases, it has been stated that an “investment contract” is a transaction, contract, or scheme whereby a person: (1) makes an investment of money; (2) in a common enterprise; (3) with the expectation of profits; and (4) to be derived solely from the efforts of others.23. This definition has been adopted by the Supreme Court of the Philippines which succinctly stated that an investment contract in our jurisdiction, to be a security subject to regulation by the Commission, must be proved to be (1) an investment of money; :(2) in a common enterprise; (3) with expectation of profits; and (4) primarily from efforts of others,” as reads the order.
EIPD personnel who requested it was able to show that the investment scheme of respondent KAPA falls within the ambit of an investment contract. The investment scheme of respondent KAPA albeit denominated as a “Donation,” is actually an investment contract because of its essential features, as follows:
(1) The member-investor enters into a contract. There is a placement of money where for a certain sum as stated in the emails received by the Commission, the members-investors were promised thirty percent (30%) interest per month for life on their investment or so-called “Donation.”,
(2) The money invested is placed in a common enterprise and the investor-member expects to derive profits.
(3) Finally, the member-investor expects to earn profits from the donation.
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