BAGUIO CITY – The local office of the Securities and Exchange Commission (SEC) reiterated its previous warning to the public not to be carried away by the attractive offers in the social media regarding an alleged on-going recruitment for supposed networking or multi-level marketing that might result to their losing their hard earned money to a false lucrative investment.
SEC Baguio field office head lawyer Regina May Cajucom explained the networking or multi-level marketing offered by paysbook on Facebook had been subjected to a previous advisory by its central office as it is emerging as another form of scam that could result to eventual losses to prospective investors.
She revealed that the company was issued a license by SEC as a business corporation but it does not have the appropriate secondary license to sell securities as having a primary license does not automatically guarantee license for the corporation to sell securities to their prospective clients.
“One of the practical gauges is when a company selling securities is offering clients incentives that are too good to be true, the public must be fully aware they are about to be hoodwinked into a scam that will result to eventually losing their hard earned investments,” Cajucom stressed.
The SEC official asserted the agency does not automatically grant companies with secondary franchises to sell securities as the investment scheme will have to undergo a stringent investigation where the applicant must prove that the return on investments will come from the income to be derived from the sale of available products and not from the money of people investing in the company.
According to her, one of the reasons why there are companies that try to re-invent their schemes to attract investments from the public is the human weakness of greed for higher income and this may lead to the loss of their resources, thus, people need to be informed and educated on how to detect if the schemes they are about to invest in are real or simply a hoax.
Cajucom underscored that people should not easily trust the claim of investment scheme operators that their companies are SEC registered and instead, they should look into whether or not the said companies have been issued secondary licenses to sell securities as this will add to the security of their investments once placed in accredited companies with licensed brokers and distributors to sell securities.
She advised that with the hundreds of companies that have been involved in investment scams around the country, people should have learned their lessons by first inquiring from the SEC on the legitimacy of their operations aside from the existence of primary and secondary licenses.
Aside from issuing the appropriate licenses to companies intending to operate in the country, SEC also issues licenses to brokers and distributors of securities after having undergone stringent trainings and examination.