Good economic times can bring out the worst economic motives on the part of some people, it seems. Biz Buzz is talking about the growing proliferation of scammers who are now starting to cast a wider net and victimize stock market newbies.
“We are alarmed by reports that have reached us on unscrupulous practices that are perpetuated to scam potential stock market investors. These practices not only cheat the victims of their money but also unduly stains the reputation of the stock market among retail investors,” PSE president Hans Sicat said yesterday.
Those looking to invest in the stock market must open their own account with and only with PSE-accredited brokerage firms and to transact only with employees of their chosen brokerage firm. The PSE also warned the public not to fall for investment solicitations that offer share prices at discounted prices. Some of these schemes may include offering supposed shares of employee stock option plans.
“While it is true that some employee stock option plans may be offered at discounted prices, the PSE approves these provided their distribution is confined to employees of companies offering the plan as part of their benefits. Also, always ask for a receipt when making investments in the stock market and the receipt must be issued by the licensed broker,” Sicat added.
In addition, Sicat cautioned the public against solicitations for stock market investments that guarantee returns on investment. While the Philippine stock market has provided compelling returns in the past years due to the positive corporate and the country’s economic performance, the public must understand that share price movements can never be guaranteed.
To attract victims of scams, the PSE said perpetrators of such illegal activities make it appear that opening an account with a broker is a complicated transaction and that the process can be made easier if the investment is made directly in the account of the perpetrators rather than opening an account directly with an accredited broker.
Inquiries on investments and complaints on stock market scams may be reported to the PSE through 819-4100 or via email at pird@pse.com.ph. Doris Dumlao-Abadilla
Foreign cement floods Tacloban
THE REHABILITATION of the ruins left by Supertyphoon Yolanda in Eastern Visayas —particularly in Tacloban—should mean good business for the locals, especially with available national and international funds dedicated to rebuilding government infrastructure projects and housing units.
But Biz buzz learned that the realities on the ground left local business groups disappointed.
According to our source, around 600,000 bags of imported cement from Vietnam’s Thang Long Cement, have been flooding Tacloban since February. Indeed, according to the company’s website, it has been exporting thousands of metric tons of cement to the Philippines.
Our source says that these cement deliveries are being used by a local construction company in its batching plant in Tacloban. The importer sells it to himself for ready mix concrete at a price of P250 per bag, while the current market price in Tacloban stands at only P230 per bag. Smells fishy.
Then there’s also the issue of quality control and safety. Our source tells us that the quality of this imported cement cannot be assured possibly because handling, storage and distribution can be compromised.
Apparently, no quality checking systems are enforced to guarantee the integrity of these products compared to those that are produced locally.
So is this competition from imported cement bad?
“There is nothing wrong with competition,” our source said. “But competition should be based on a level playing field. We should make certain that proper taxes are paid for and that strict regulations against transfer pricing are properly imposed to foster a healthy competition.”
With business booming, perhaps the Bureau of Internal Revenue should indeed investigate this matter, and check whether correct taxes have been paid. Daxim L. Lucas
Winning over Fundador staff
ASIDE from spending hours diligently going through the numbers that explain the profit potential and brand value of Spain’s Fundador, tycoon Andrew L. Tan also exerted time and effort to win over the hearts and minds of the proud employees of Fundador, one of Spain’s most popular and valuable brands.
Tan knows that the employees and people who have been working for years for Fundador are passionate and sentimental about Spain’s crown jewel, thus its sale to Filipino-owned and led Emperador Inc. may raise concerns.
To allay any fears, Tan and Emperador —which was incidentally inspired by the name Fundador—spent time to explain who Emperador is, that it is now the world’s top brandy company with roots in the Philippines, which is also the biggest market of Fundador.
Also helping smooth things along is the fact that the great grandson and descendant of the French noble family of Domecq, which started the Fundador brandy empire, now heads Grupo Emperador, Emperador’s company in Spain.
Jorge Domecq Bohorquez has been with Emperador for three years and Fundador employees know him well.
The people of Jerez, Spain’s brandy capital where the iconic Bodegas Fundador is located, are also getting to know Tan better, following his shopping spree in Spain.
Aside from his company’s purchase of Fundador and three other international liquor brands late last month for P13.8 billion, he also made a surprise “personal investment” of P11.5 billion in Torre Espacio, one of Madrid’s most modern and iconic skyscrapers.
And his shopping days are far from over. Indeed, a new era begins. Tina Arceo-Dumlao
Uphill battle
IT WILL most likely be a difficult fight, but the country’s electric cooperatives plan to push for changes to the Electric Power Industry Reform Act (Epira) once a new set of lawmakers are elected next year.
Their goal—noble or foolhardy, depending on whom one asks to—is nothing less than to bring down the cost of electricity in the country.
These electric cooperatives have come together under the banner of a group called the National Association of General Managers of Electric Cooperatives under its president Sergio Dagooc.
The problem, he believes, is that the current Epira Law is more pro-business than pro-consumer.
So the group wants the next Congress to do several things. It wants a repeal of the cross-ownership provision, allowing cross-ownership in generation and distribution. It wants to bar the government from operating its own power plants.
It wants to accelerate the privatization of the government’s remaining hydro and thermal power assets. And perhaps most importantly, it wants Congress to create a so-called Mindanao Power Corp. which will have roles similar to the old National Power Corp., but focused on the electricity needs of the Mindanao market.
Dagooc points out that about half of the country’s population is being served by smaller electric cooperatives, so he knows what he’s talking about. And he’s saying that allowing electricity producers to be in the electricity distribution business is bad for the consumer because it is being abused by the big firms.
“Prohibiting cross ownership would open the market, make it more responsive to consumers and promote a level playing field,” he said, adding that government should also be given the power to run and operate back-up plants to balance market forces that are, at present, heavily skewed in favor of the big companies.
To do all these, the group has enlisted the help of former Energy Secretary Carlos Jericho Petilla to help them further their pro-consumer agenda. Of course, Petilla is out of government right now after having resigned from the Cabinet of President Aquino a few months ago, but he’s hoping to return to government service through the legislative branch should fortune favor his Senate bid in 2016.
But first, their would-be champion has to win a Senate seat. And that, in itself, is another difficult battle they have to fight. Daxim L. Lucas
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