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Criminal charges filed vs KAPA officers

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By James A. Loyola

The Securities and Exchange Commission (SEC) has filed criminal charges against Kapa-Community Ministry International, Inc. (KAPA) before the Department of Justice.

The criminal complaint was filed against KAPA along with its founder and president Joel A. Apolinario, trustee Margie A. Danao and corporate secretary Reyna L. Apolinario, among others, for allegedly perpetrating an investment scam in violation of Republic Act No. 8799, or the Securities Regulation Code (SRC).

The SEC also implicated Marisol M. Diaz, Adelfa Fernandico, Moises Mopia, Catherine Evangelista and Rene Catubigan for allegedly promoting the investment scam.

The commission said it will name more respondents as it identifies other persons who have participated in the unlawful public offering and/or selling of securities by KAPA.

The SEC alleged that KAPA enticed the public to “donate” at least P10,000 in exchange for a 30 percent monthly “blessing” or “love gift” for life, without having to do anything other than invest and wait for the payout.

The Commission issued an advisory against KAPA as early as March 2017. It would later issue a cease and desist order on February 14 and an order of revocation of the nonstock corporation’s registration on April 3.

In the interest of affected investors, the Commission, through the Anti-Money Laundering Council, obtained a freeze order from the Court of Appeals on June 4 to preserve assets linked to KAPA.

The investment scheme operated by KAPA involved the sale and offering for sale or distribution to the public of securities, in the form of investment contracts, as defined under Section 3 of the SRC.

The SEC also found KAPA to have allegedly employed a Ponzi scheme, an investment program that offers impossibly high returns and pays investors using the money contributed by other investors. This qualifies as a fraudulent transaction prohibited under Section 26 (26.3) of the SRC.

A person found to have violated the SRC, or the relevant rules and regulations promulgated by the SEC, will face a maximum fine of P5 million or imprisonment of seven to 21 years, or both.

The penalty to be imposed against the respondents should be one degree higher than what is prescribed by the SRC, according to the SEC, considering the use of Facebook and YouTube in the illegal invest scheme.

Section 6 of Republic Act No. 10175, or the Cybercrime Prevention Act of 2012, provides for the imposition of a penalty one degree higher than what the Revised Penal Code, as amended, and special laws provides if the crime or offense was committed by, through, and with the use of information and communication technologies.

“We shall never let up on our crackdown on investment scams, as we uphold our mandate to champion and protect the interests of the investing public,” SEC Chairperson Emilio B. Aquino said.

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