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- The Securities and Exchange Commission (SEC) is warning the public about BKC Trading and its CEO and Founder Francis Mariano.
- The firm is branding itself as a crypto-related investment platform that offers 12% to 36% return within 3 to 6 months, but the SEC notes that it is not registered with the Commission and that its investment scheme involves offering securities in the form of an “investment contract.”
- The SEC views the scheme as a Ponzi scheme, and has recently released a draft version of the implementing rules and regulations of the Financial Products and Services Consumer Protection Law to impose stricter penalties on scammers and Ponzi schemes.
Following the report from the Enforcement and Investor Protection Department (EIPD) of the Securities and Exchange Commission (SEC), the commission is warning the public to be cautious when dealing with the activities of BKC Trading and its CEO and Founder Francis Mariano.
According to EIPD, the firm is enticing its investors by branding itself as a crypto-related investing platform which offers 12% to 36% return within 3 to 6 months for their plans ranging from a minimal amount of ₱30,000.00 up to ₱1,000,000.00. To enter their platform, investors must first contact them through their website or by their private invitation if you have an existing contract or a good profile with their BKC Savings.
Accordingly, the Commission noted under Section 3.1 of the Securities Regulation Code that the investment scheme of BKC Trading involves offering and sale of securities in the form of “investment contract.” Therefore, it is required to have a secondary license from the Commission pursuant to Sections 8 and 12 of the SRC.
“However, an investigation conducted by this Department shows that BKC TRADING is not registered with the Commission as a corporation or partnership based on an initial verification from the Commission’s Online Document Retrieval System (ODRS). BKC TRADING transacts with the public or prospective investors only through social media such as online group chats on Facebook (FB) and through their website,” the SEC highlighted stressing that the entity is not authorized to solicit investments from the public as BKC Trading did not secure prior registration and/or license to solicit investments.
Moreover, the Commission also emphasized that the scheme being employed by the entity is clearly in the form of a Ponzi Scheme—a type of fraud that lures investors and pays profits to earlier investors with funds from more recent investors. The SEC stressed that such a scheme is not a registrable security and the Commission will not issue a License to Sell Securities to the Public to persons or entities that are engaged in this business or scheme.
Consequently, in a bid to further fight against fraudsters leveraging on the popularity of crypto in the country, the SEC recently released a draft version of the implementing rules and regulations (IRR) of the Financial Products and Services Consumer Protection Law (Republic Act 11765). Once implemented, the Commission can impose stricter penalties on scammers and Ponzi schemes. (Read more: STRONGER FINANCIAL REGULATIONS: SEC Issues Draft To Impose Stricter Penalty vs Scammers, Ponzi Schemes)
The Commission also signed a memorandum of understanding (MoU) with the University of the Philippines Law Center (UPLC) through the University of the Philippines Legal Center Research Program to conduct joint research and capacity-building projects focusing on cryptocurrency and financial technology regulation. (Read more; SEC Partners with UP Law Center for Joint Research on Crypto, Fintech Regulations)
For more SEC articles and advisories, click here.
This article is published on BitPinas: Scam Alert: SEC Calls Out BKC Trading for Unauthorized Investment Scheme
Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.