Connect with us

Hi, what are you looking for?


SEC readies investor education unit as scam cases rise

By Keren Concepcion G. Valmonte

THE Securities and Exchange Commission (SEC) will be setting up an office dedicated to helping the public gain financial literacy following the rise in unauthorized investment schemes during the pandemic.

“Chairperson Emilio B. Aquino plans to establish an Office on Investor Education to address the growing problem of investment scams in the country,” the commission told BusinessWorld in an e-mail interview.

The SEC described 2020 as a “record-breaking year” after the corporate watchdog issued 127 advisories against easy money schemes, 95% higher than the total 65 advisories issued in the previous year.

“The Commission has seen more unauthorized investment schemes amid the pandemic, at a time when many of our fellow Filipinos have lost their jobs and would be willing to take any chance at earning a living,” the SEC said.

In the first quarter of 2021, the commission released 15 advisories on entities offering unauthorized investment schemes.

Last week, the SEC also issued warnings against the following: WONKACASH or WONKA Cash App Financial Consultancy Services, Investrade Marketing or Investrade Digital Marketing Services, Learn and Earn Online, CryptoTrading FX, 247 Cryptotrade Online, ExchangeStock, Binary Options Trading, Wolves Options, and IX Trade.

Some investors find stock, bond, and other organized markets intimidating and fraudsters are taking advantage of the investment landscape via new concepts such as digital assets and cryptocurrencies, the commission said.

Schemes are often disguised as donations, educational packages, online gaming, online marketing or advertising, multi-level marketing, reseller business, cryptocurrency mining, and foreign exchange trading.

Ponzi schemes, pyramid schemes, and boiler room operations were identified as the three most widely used investment scams in the country.

In Ponzi schemes, groups “lure” new investors by offering programs that generate high returns with little to no risk.

“In reality, such schemes have little or no legitimate earnings, thus requiring a consistent flow of money from new investors in order to continue,” the SEC explained.

Earnings from pyramid schemes, just like Ponzi schemes, rely on recruitment fees gathered from new investors. However, organizers may ask investors to sell products as a cover.

“Usually, they offer products as a front to make their operations look legitimate. But the products are usually overpriced, worthless, or nonexistent,” the commission said.

However, this is not the same as multi-level marketing, which offers actual products.

Meanwhile, boiler room operations “use high-pressure sales tactics to sell illegitimate investment products such as unreasonable rates of returns and promises of profit.”

Boiler room operators also use “encouraging lines” to attract investors, such as: “This investment opportunity is ‘once-in-a-lifetime’ and you would be stupid to miss out on it!”

“The commission attributes the prevalence of investment scams to people’s lack of awareness of the legitimate investment options available to them, and of the laws, rules and regulations governing investment solicitations,” the SEC said.

It added that the problem highlights the need for financial literacy, inclusion, and sustained enforcement.

The SEC has a financial literacy webinar series, various resource courses, and held its first “Investor Protection Week” last year, which will now be observed every second week of November.

The investing public is reminded to look for a license from groups offering investment opportunities before giving into their offer.

“A certificate of incorporation from the SEC does not automatically authorize a company to take investments from the public,” the commission added.

Registered stock corporation Bill Ford VIP Trading, Inc. had its SEC registration revoked last week for offering unauthorized investment programs.

The commission tells investors: “Ask for a prospectus, offering circular, financial [statements], or other similar [documents] before you even consider investing. Then read the small print carefully, particularly on refund, and make sure you understand the terms thoroughly before signing any kind of commitment.”

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!



Virgin Orbit’s next satellite launch will take place from the UK, following the success of the “Straight Up” mission, which lifted off from Mojave...


Post Office collection and cash delivery workers are to stage a one-day strike later this month in a dispute over pay. Members of the...


UK consumers cut back on credit card borrowing in May amid fears over rising interest rates and a slowing economy driven by a cost...


London City airport is seeking to overturn its Saturday flight ban and raise by 40% the limit on its passenger numbers. A local residents’...


The bank said that it was introducing a £1,200-a-year pay increase from August 1, which would start to show in next month’s pay packets....


Postmasters caught up in the Horizon IT scandal say that they are still being “left in the dark” about a compensation package after the...

You May Also Like


Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...


Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...


Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...


As a traditionally rigid insurance industry becomes bogged down by antiquated processes and operations, a handful of industry leaders are seeking to shake things...

Disclaimer:, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.