The Securities and Exchange Commission (SEC) said it won a case against individuals involved with the investment scam of GDM Finance SARL, the 22nd conviction for violations of the country’s securities law.
The SEC said the Pasig City Regional Trial Court found Anita Armada, Milany Cabrera, Josephine Maranan, Nanette Tongco, Gerald Samson, and Jacinto Lucio De Catalina guilty of violating the Securities Regulation Code with their investment solicitation for GDM. The ruling was handed down in April where the individuals were fined P100,000 each, with subsidiary imprisonment.
The case stemmed from an information received by the SEC’ Enforcement and Investor Protection Department in July 2018, alleging that GDM had conducted a seminar in a mall where speakers enticed the audience to invest in GDM for a weekly return of at least 2.5 percent.
“After conducting an on-site field investigation, the EIPD confirmed that GDM indeed engaged in investment-taking activities. The investigation also uncovered that GDM had a Facebook account where it advertised that it could pay dividends to shareholders and provide a steady return on investment received,” the SEC said.
The EIPD then worked with the Anti-Cybercrime Group of the Philippine National Police to entrap the individuals, arresting them in November 2018.
The SEC noted GDM had not registered any securities with the Commission as required under the SRC. Neither had it secured a license to issue mutual funds, exchange traded funds and proprietary or non-proprietary shares or membership certificates and timeshares.
“In this case, it is clear that the accused is soliciting investment from the attendees and promises that the same will earn guaranteed profits through the placements that will be made by GDM,” the Pasig court said.
“Additionally, the prosecution was able to establish that despite the securities being unregistered, such fact was not made known by the individual accused to its prospective investors who attended the orientation seminar. Thus, they are liable under Section 26.2 of the SRC for omitting a material fact that misleads the public into believing that the securities they offer are registered,” it added.
The SEC said the GDM convictions adds to its list of conviction of 33 individuals in 22 cases, with a total imprisonment of 712 years and an aggregate fine of P28.4 million.
“As of September 2023, 355 individuals are being actively prosecuted before the Regional Trial Courts in 145 cases for violations of the SRC and two cases for violations of Republic Act No. 11765, or the Financial Products and Services Consumer Protection Act of 2022,” the SEC said.
“Furthermore, as of June 30, the SEC has filed criminal complaints against 31 corporations and 239 individuals before the Department of Justice, all of which are currently pending resolution,” it added.
