THE Securities and Exchange Commission (SEC) has warned the public against The Philippines Good Samaritan Riders Association Inc. (TPGSRA) as it has no permit to solicit investments from the public.
The group reportedly disguised its investments as “donations.”
TPGSRA is registered as a corporation with the SEC, but it does not have a secondary license to engage in investments or securities.
Based on the SEC advisory, TPGSRA, which also goes by the name the Good Samaritan Riders Club, has been encouraging the public to “donate” P8,000 to the group, and the funds are said to be used to sponsor someone inneed of a motorcycle.
The donor would then be qualified to receive a new motorcycle. However, he has to look for two sponsors, so he could receive financial assistance of P5,000, which would be used as a down payment for the motorcycle.
TPGSRA promised it would continue assisting the donor by paying the monthly dues in the amount of P3,000 for the first two months. In the event that the amount of down payment and monthly dues are greater than the provided amount, the donor is obliged to pay the excess amount.
The group promised to pay the monthly dues in the first 36 months, depending on the number of donors and sponsors the donor could get in his group, a portion of the SEC advisory read.
The Securities Regulation Code (SRC) states that such activities need to have a secondary license from the SEC, and the products should be registered with the SEC before they can be sold to the public.
According to the SRC, a person found to be recruiting more members to join the group may be held criminally liable and punished with a fine of up to P5 million, and imprisonment of up to 21 years.
In an advisory posted on its Facebook page, TPGSRA said it has suspended temporarily its operations to comply with the SEC advisory.
“All coordinators and sub-coordinators are hereby ordered to stop any activity that would contradict with the SEC advisory,” the advisory read.
The group further said that its operations would resume after all the appropriate licenses and other legal requirements were fully complied with.
The SEC has been recently conducting investigations on investment scams.
A few weeks ago, the SEC filed a criminal complaint against Kapa-Community Ministry International Inc., including its president and other officials before the Department of Justice, for it allegedly defrauded its members. (JJL)