The Securities and Exchange Commission (SEC) has revoked the business registration of Wellcons Unlimited Systems Inc. for employing a “double-your-money” scheme to illegally solicit investments from the public.
In an order dated July 5, the SEC Enforcement and Investor Protection Department (EIPD) found that Wellcons has been publicly offering securities without the necessary secondary license from the Commission in violation of the Revised Corporation Code of the Philippines.
According to the SEC, Wellcons’ activities also constituted serious misrepresentation as to what it can do, to the great prejudice of or damage to the general public, a ground for the revocation of a corporation’s certificate of registration.
Wellcons has been offering investment packages worth P2,500 to P13,890 under a so-called Binary System, with guaranteed returns of up to P9,000 to P32,000 per day.
Members who availed investment packages under the Binary System can further earn through Wellcon’s Pangkabuhayan Program, where they can supposedly double their money within six months based on investment packages worth P1,500 to P5,000.
Wellcons likewise promised leadership bonuses and referral fees, among others.
“Wellcons’ investment scheme involves securities, particularly an investment contract, whereby a person invests his money in a common enterprise and is led to expect profits primarily from the efforts of others, the EIPD said.
While Wellcons is a duly registered corporation with the SEC, it has never secured a secondary license from the Commission to operate as a broker/dealer of securities, nor is it a registered issuer of any securities.
The EIPD further noted that Wellcons’ double-your-money scheme through its Pangkabuhayan Program resembles a Ponzi scheme, where the profits or payouts taken from incoming investors are paid to existing or earlier investors.