THE Department of Justice (DOJ) has recommended criminal charges against the Kapa-Community Ministry International Inc. (Kapa) and its executives for violation of the Securities Regulation Code.
Securities and Exchange Commission (SEC) Assistant Director Oliver Leonardo said the Justice department found Kapa and its executives liable for violating several provisions of the code.
“The DOJ issued a resolution, dated Sept. 25, finding probable cause and liability against Kapa and its officers for violation of the SRC code, particularly Sec. 8.1 (offering and selling securities without registration with the SEC), Sec. 26.1 (employment of any fraudulent scheme), and third acting as a securities broker without prior registration with the SEC,” he said.
He said the SEC got hold of a copy of the resolution last Monday, Oct. 21, 2019, around four months after they filed their complaint before the DOJ on June 18.
The resolution named Kapa founder and president Joel Apolinario, its trustee Margie Danao and Reyna Apolinario, as among those who could be charged for violating the SRC.
Marisol Diaz, Adelfa Fernando, Moises Mopia and Reniones Catubigan were also implicated for promoting the investment scam.
Those proven to be guilty of violating the SRC, or relevant rules and regulations announced by the SEC, would face a maximum fine of P5 million or imprisonment of seven to 21 years, or both.
Leonardo said the DOJ also found Kapa’s activities violative of the anti-cyber crime law for propagating its scheme online.
“According to the resolution, proceed to the filing of case to proper court na (already). Inaabangan natin kung saan mapupunta yung kaso na yan kung saan i-fifile (We are awaiting where the case will be filed) because Kapa’s operation is nationwide,” he said.
“It takes branches in several cities and municipalities all over the Philippines and especially since they propagated their scheme through the internet and social media, as well as YouTube,” he added.
Section 6 of Republic Act 10175 or the Cybercrime Prevention Act of 2012 provides for a penalty that is one degree higher than what the Revised Penal Code imposes if a crime was committed through the use of communication technologies.
Last March 14, the SEC made permanent its cease and desist order against Kapa, after the latter was found to be soliciting investments from the public in a manner similar to a Ponzi scheme.
A Ponzi scheme is an investment fraud that offers impossibly high financial returns and pays investors out of the capital contributed by new investors.
Kapa reportedly enticed its members to “donate” at least P10,000 each, in exchange for returns of 30 percent per month for life.
On April 3, the SEC revoked Kapa’s Certificate of Corporate Registration for the “fraudulent and misleading” act of offering and selling securities despite not having the authority to do so as a religious corporation.
On June 10, through a search warrant issued by Manila Regional Trial Court Branch 20 Judge Marivic Umali, the National Bureau of Investigation 7 and the Philippine National Police raided the offices of Kapa-Community Ministry International Inc. nationwide, including in Barangay Poblacion, Compostela, Cebu, where they seized documents and a big vault believed to contain millions of pesos in cash.