SEC Released A Warning Against Two Unauthorized Investment Groups
The Securities and Exchange Commission (SEC) has recently released a warning to the public against groups that solicit investment without a license to sell securities.
In SEC’s advisory on their website, they flagged Cashdrop/Cashdrop Online Store and Lokal.Plate Corp. as unauthorized operators of investment schemes. Additionally, they advised the public “not to invest or stop investing in any investment scheme being offered by (Cashdrop and Lokal.Plate)” and to “exercise caution in dealing with any individuals or group of persons soliciting investments for and on behalf of it.”
According to SEC, Cashdrop has no record of registration with the commission. It only managed to secure a business name registration at the Department of Trade and Industry (DTI). Thus, Cashdrop is not authorized to solicit investments from the public since it has not secured prior registration and/or license from the commission as prescribed (by the Securities Regulation Code). The said investment company is offering packages that supposedly allowed investors to double their money in 15 days.
On the other hand, Lokal.Plate has a similar scheme and solicits investments from the public. Their main is franchising for a supposed food service provider called “Lokalplate”, where orders are made through a digital link that franchisees must promote. Lokal.Plate then promises a 15% to 20% commission for every ordered food, and a PHP3,000 commission whenever they recruit a new investor. Lokal.Plate is also not authorized to solicit investments from the public, just like CashDrop the SEC said.
The group has registered itself as a corporation, but it lacks a secondary license to allow the operation of an investment scheme. The SEC noted that Lokal.Plate’s articles of incorporation explicitly say it “shall not solicit, accept or take investments/placements from the public neither shall it issue investment contracts.”
Cashdrop and Lokal.Plate may be penalized with a PHP5-million fine and a 21-year imprisonment or both.