SEC revokes Kapa's certificate of incorporation

Logo courtesy of Securities and Exchange Commission and Kapa-Community Ministry International, Inc. Facebook page
Logo courtesy of Securities and Exchange Commission and Kapa-Community Ministry International, Inc. Facebook page

SECURITIES and Exchange Commission (SEC) has issued another revocation order to Kapa-Community Ministry International, Inc. (Kapa).

This time around, forfeiting its certificate of incorporation for unauthorized investment-taking scheme.

In a press release issued Friday, April 5, SEC revoked Kapa's registration for “serious misrepresentation on what it can do or is doing to the prejudice and damage of the public.”

In a decision dated April 3, the Commission En Banc granted the petition of the SEC Enforcement and Investor Protection Department to revoke Kapa’s certificate of incorporation for offering and selling 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 revokation was based under Section 6(i)(2) of Presidential Decree No. 902-A, or SEC Reorganization Act.

“Kapa in dealing with the public is using its registration with the Commission as a religious corporation as a backdrop to solicit investments from the public knowing that it does not have the requisite registration. Such act is indicative of Kapa's intent to deceive the public on what it can do or is doing to the damage and prejudice of the investing public,” the Commission En Banc ruled.

According to SEC, Kapa is explicitly prohibited from undertaking business activities, as provided on its certificate of incorporation.

SEC said it would require a secondary license such as acting as broker or dealer in securities, investment house and close-end or open-end investment company, in order to undertake such activity.

“Despite its lack of authority to offer and sell securities, Kapa recruited and encouraged members to ‘donate’ any amount in exchange for a 30 percent monthly return for life, without having to do anything other than invest and wait for the payout,” SEC said.

The agency earlier issued a cease and desist order against Kapa on February 14, making the order permanent after failing to file a motion for the lifting within the prescribed period.

The order covered 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.

The SEC reiterated its advice for 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. (RGL)

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