BSP denies approving KAPA’s investment scheme

The Bangko Sentral ng Pilipinas (BSP) on Wednesday denied  the claim that the central bank has approved Kapa-Community Ministry International’s (KAPA) investment scheme.

“The BSP advises the public that it has not released any statement or any issuance concerning the Kapa-Community Ministry International Inc. (KAPA) or any of its affiliates,” the central bank said.

The BSP emphasized that KAPA is not a central bank-supervised entity.

“This clarification is being issued in view of reports, particularly, on social media, falsely claiming that the BSP has issued a statement purportedly approving KAPA’s investment scheme or questioning delays on its approval by the Securities and Exchange Commission (SEC),” the BSP said.

The SEC has renewed its warning and advised the public at large to exercise more caution and discernment amid disinformation campaigns of investment scammers.

The commission took note of false claims by KAPA on social media. Supposedly, the group was poised to secure the necessary licenses to resume its operations.

KAPA also falsely claimed that it already filed with the SEC an application for a secondary license to sell and offer for sale securities to the public.

“SEC has already issued a cease and desist order against KAPA in February 2019 and an order of revocation of its certification of incorporation in April 2019 after KAPA was found to have been soliciting investments from the public without the necessary license, and that its investment scheme qualifies as a fraud and a Ponzi scheme,” the BSP said.

Under its scheme, KAPA had enticed the public to “donate” P10,000 in exchange for a 30% monthly “blessing” or “love gift” for life, without having to do anything other than shell out money and wait for the promised payout.

Section 8 of Republic Act No. 8799, or the Securities Regulation Code, provides that “securities shall not be sold or offered for sale or distribution within the Philippines, without a registration statement duly filed with and approved by the commission.”

It prohibits fraudulent transactions, including Ponzi schemes where investors are lured by impossibly high returns and paid using money contributed by other investors.

Section 28 further states that no person shall engage in the business of buying or selling securities in the Philippines as a broker or dealer, or act as a salesman, or an associated person of any broker or dealer unless registered with the SEC.

In this light, those acting as salesman, broker or agent may be prosecuted and held criminally liable. They may also face a maximum fine of P5 million or imprisonment of 21 years or both, pursuant to Section 73 of the Securities Regulation Code.

On June 18, the Commission filed a criminal complaint against KAPA, its founder and president Joel A. Apolinario, trustee Margie A. Danao, corporate secretary Reyna  L. Apolinario, and other promoters of the investment scam. —VDS, GMA News