Kapa founder Joel Apolinario
Kapa founder Joel ApolinarioFile photo

Kapa execs sentenced to life in prison

EXECUTIVES and officers of Kapa Community Ministry International Inc. (Kapa) were sentenced to life imprisonment for duping millions from its investors.

Found guilty of eight counts of syndicated estafa beyond reasonable doubt were Kapa's founder Joel Apolinario and the group's incorporators Cristobal Baradad and Joji Jusay.

The accused were also sentenced to pay eight actual damages amounting to P195,000 to the complainants.

Syndicated estafa has been defined under the Revised Penal Code as a crime committed when a person defrauds another by “means of false pretenses or fraudulent acts executed prior to or simultaneously with the commission of fraud, by using a fictitious name, or falsely pretending to possess power, influence, qualifications, property, credit, agency, business, or imaginary transactions, or by means of other similar deceits.”

Under Section 1 of Presidential Decree 1689, any person who commits estafa and other forms of swindling shall be punished by life imprisonment or death if the swindling is “committed by a syndicate consisting of five or more persons formed with the intention of carrying out the unlawful or illegal act, transaction, enterprise or scheme, and the defraudation results in the misappropriation of money contributed by stockholders, or members of rural banks, cooperative, ‘samahang nayon(s),’ or farmers association, or of funds solicited by corporations/associations from the general public.”

Branch 33 of Regional Trial Court (RTC) of Butuan City, in a ruling made on December 12 and cited by the Securities and Exchange Commission (SEC) in a press release on December 21, 2023, found all the elements of estafa present in the case.

"Clearly, [Apolinario] together with [Baradad and Jusay] employed fraud or deceit by falsely pretending or misrepresenting that they are authorized by the SEC to engage in profit-making business when in truth and in fact, they are not authorized to do so being a non-stock corporation," the RTC ruling stated.

SEC filed a case against Kapa in 2019 following a case build-up over its illegal investment-taking activities. It also came more than a week after then President Rodrigo Duterte ordered the closure of Kapa, a non-stock and independent religious corporation.

SEC found out that Kapa had enticed the public to donate at least P10,000 in exchange for a 30 percent monthly “blessing” or “love gift” for life, “without having to do anything other than invest and wait for the payout."

“Relying on this false pretense, the complainants were duped to invest their money. As a result they suffered damage since nothing was returned from their investments,” the SEC said in a statement issued on December 21, 2023, citing the court decision.

The court affirmed the finding of the SEC that the solicitation activities of Kapa were akin to a Ponzi scheme, an investment fraud that offers impossibly high financial returns and pays investors out of the capital contributed by new investors.

"The court takes credence on the testimony of the witness from SEC, who testified that the means employed by Kapa is akin to a Ponzi scheme," stated the court ruling.

“In People of the Philippines vs Rosario Baladjay, which is on all fours with the present cases, a similar ruling was made by the Supreme Court which explained the too-good-to-be-true promises of a Ponzi scheme, wherein the purported investment program offers impossible high returns and pays these returns to early investors out of the capital contributed by later investors,” it added.

Apolinario and other Kapa’s leaders are also facing several other fraud cases in other courts in Manila, Cagayan de Oro City and Bislig City in Surigao del Sur.

It had also duped a number of people in Cebu.

Apolinario claimed that Kapa had five million members.

The Kapa investment scam has been considered the largest investment scam in Philippine history. It is bigger than the Aman Futures scam, where 15,000 people in the Visayas and Mindanao lost around P12 billion in 2012. (LMY)

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