Over P100 million worth of assets linked to Kapa-Community Ministry International Inc. have been frozen upon the order of the appellate court, the Securities and Exchange Commission said over the weekend.
"Several banks have initially frozen more than P100 million pursuant to the freeze order, which also covers insurance policies, cryptocurrency holdings, and other assets linked to Kapa," the corporate regulator said in an emailed statement on Sunday.
The Court of Appeals (CA) issued the freeze order on Kapa's bank accounts and other assets on June 4, as the SEC considers the firm as an investment scam.
This came days after President Rodrigo Duterte ordered the National Bureau of Investigation (NBI) and the Philippine National Police–Criminal Investigation and Detection Group (PNP–CIDG) to shut down Kapa Ministry.
"Kapa amassed wealth through an investment scam, in the guise of religion and at the expense of the investing public... We cannot simply wait for the fraudulent investment scheme to crumble and for the investors to suffer before we take action," said SEC Chairperson Emilio Aquino.
Thus, the SEC made its cease and desist order (CDO) against Kapa Ministry permanent last March, stopping the company from soliciting investments without the proper license.
An earlier CDO against Kapa was issued in February after substantial evidence found that the company offered and sold securities in the form of investment contracts and in the guise of donations, even without the license to do so.
"KAPA violated the law and must now face the consequences of its actions," said Aquino.
"Any and all persons behind and involved, in one way or another, in the investment scam will be prosecuted and held criminally liable," he added.
Aquino last week said the SEC intends to file criminal charges against Kapa and its officials, as the company continues to accept financial investments while its necessary permits have been revoked by the regulator.
Duterte on Thursday apologized to people victimized by Kapa, but he reiterated that the shutdown will still have to be enforced.
Latest videos uploaded by Kapa Ministry on YouTube claim that the company currently has 5 million investors, all of whom have been promised a 30% monthly return on investment for life.
According to SEC research, minimum placements in Kapa are P10,000, with the maximum at P2 million, leading the commission to estimate that Kapa has amassed some P50 billion, with payouts equivalent to at least P15 billion a month.
"They have presented an unrealistic return on investment (ROI) which is ridiculously high and the scheme is mathematically impossible," Aquino said last week.
"If he continues even just for a year, that’s P180 billion that he needs to be able to cover his promised investments or whatever he calls it," he elaborated.
For its part, Kapa lawyer Rommel Cahayag said the donations and investments that flow into the company are channeled into several "business interests" including one in mining. —Jon Viktor Cabuenas/LBG, GMA News