August 19, 2024 | 12:00am
MANILA, Philippines — The Securities and Exchange Commission (SEC) has trumpeted another success in its enforcement against what is considered as the largest investment scam in the country’s history.
The SEC said Kapa Community Ministry International Inc. (KAPA) founder Joel Apolinario has been found guilty of estafa, following a complaint filed by one of its investors in Cebu who did not receive the promised interest for his P500,000 investment.
According to the commission, the 7th Municipal Circuit Trial Court Liloan-Compostela sentenced Apolinario and KAPA’s officer-in-charge in Cebu, Christopher Abad, to imprisonment of up to one year and one day for violating the Revised Penal Code.
They were likewise directed by the court to pay the complainant actual damages amounting to P500,000.
“It is clear that both [Apolinario and Abad] participated in the deceptive scheme to solicit money from a private complainant in exchange of promised high return of investment cleverly called ‘blessings,’” the court said.
It was also affirmed that KAPA engaged in a Ponzi scheme, a type of fraud that involves using the investments of new investors, to pay existing investors their purported returns.
“It is not an investment strategy but a gullibility scheme, which works only as long as there is an ever increasing number of new investors joining the scheme,” the court said.
Branch 33 of the Regional Trial Court of Butuan City last year also sentenced Apolinario and two other KAPA leaders of life imprisonment for eight counts of syndicated estafa.
According to the SEC, an individual commits estafa by defrauding another person through various means, including the use of fictitious names or falsely pretending to possess power, influence qualifications, property, credit, agency, business or imaginary transactions or by other similar deceits.
The commission issued advisories against KAPA as early as March 2017 for soliciting investments as low as P10,000 in the guise of donations.
The investments are allegedly in exchange for “blessings” worth 30 percent monthly for life, without the necessary requirements from the SEC.
The SEC said this is in violation of the Securities Regulation Code, which requires the registration of securities, including investment contracts, with the SEC before they can be offered to the public.
A cease and desist order was issued by the SEC on Feb. 14, 2019 and an order of revocation of KAPA’s certificate of incorporation on April 3, 2019.
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