SECTIONS
Monday, April 22, 2019
DAVAO

SEC orders Kapa to stop

File photo

THE Securities and Exchange Commission (SEC) has declared permanent an order barring Kapa-Community Ministry International, Inc. (Kapa) from soliciting investments from the public without the necessary license.

In a resolution dated March 14, the Commission En Banc made its cease and desist order (CDO) against Kapa permanent after the latter failed to file a motion to lift the order within the prescribed period.

The SEC issued the order on February 14 after finding substantial evidence that Kapa has offered and sold securities, in the form of investment contracts and in the guise of donations, without the necessary license and in a manner resembling a Ponzi scheme.

The CDO covers the partners, officers, directors, agents, representatives and all other persons acting for and in behalf of Kapa, which also operates as Kapa Kabus Padatuon (Enrich the Poor), Kapa/ Kappa (Kabus Padutoon), Kapa-Co Convenience Store and General Merchandise, and Kapa Worldwide Ministry.

On February 21, the Commission served the CDO at the last known address of Kapa in Bislig City, Surigao del Sur and residential addresses of incorporators Nonita S. Urbano and Junnie G. Apolinario. It also posted the order at the registered principal office of Kapa and at the Bislig City Hall for the information of the public.

The 2016 SEC Rules of Procedure provides that a CDO shall be deemed permanent if the respondent fails to file the appropriate pleading within the prescribed period. Pursuant to Section 64.3 of the Securities Regulation Code, Kapa had five days from receipt of the CDO to move for the lifting thereof.

“Since it did not file any motion for the lifting of the CDO within five days from 21 February 2019, the CDO dated February 14 is hereby made permanent pursuant to Section 4-3 (c), Rule IV, Part II of the 2016 SEC Rules of Procedure,” the Commission En Banc ruled.

Meanwhile, the SEC notes that the CDO against Kapa remains effective and valid notwithstanding an ongoing petition by the religious corporation for a preliminary injunction.

Kapa, as represented by Apolinario, filed before the Regional Trial Court in General Santos City a petition for Injunction with Application for Issuance of a 72-Hour Restraining Order, a Temporary Restraining Order and/or a Writ of Preliminary Injunction.

In an order dated March 1, the court denied the application of KAPA for the 72-hour temporary restraining order because KAPA still had a remedy to file a Motion to Lift the Cease and Desist Order with the SEC. Strangely, KAPA opted not to avail of said remedy.

The SEC believes the petition must be dismissed outright. It maintains that the regional trial court has no jurisdiction over this case.

Section 179 of the Revised Corporation Code affirms that “no court below the Court of Appeals shall have jurisdiction to issue a restraining order, preliminary injunction, or preliminary mandatory injunction in any case, dispute, or controversy that directly or indirectly interferes with the exercise of the powers, duties and responsibilities of the Commission that falls exclusively within its jurisdiction.”

The Commission calls on the public to be cautious in dealing with Kapa and to report to its head office or extension offices any continued investment-taking activity by KAPA and its allied entities.

Those who have invested money or have been invited to join Kapa may also seek the assistance of the SEC-Davao City Extension Office at SDC Building, Purok 13, Maa Road, Maa, Davao City; call (082) 298-2170 and (082) 298-1893; or send an email at kjpestares@sec.gov.ph. In Cagayan de Oro City, they may visit the Commission at the SEC Building, corner 14th and Tomasco Del Lara Street; call (088) 857-4325 and (088) 857-7225; or send an email at rvegypto@sec.gov.ph.


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