Securities and Exchange Commission (SEC) Headquarters in Makati. | PHOTO: Daniella Agacer / INQUIRER.net
The Securities and Exchange Commission (SEC) has gone after another company found to have been running an unsanctioned investment scheme in its bid to protect the public from fraud.
In a statement on Thursday, the SEC said it had revoked the corporate registration of Farm to Market (F2M) Agri-Farm OPC, which was likewise ordered to pay a total of P2 million in fines.
Once a company’s registration is revoked, it can no longer engage legally in business activities.
According to the corporate watchdog, F2M Agri-Farm and its related and unregistered entities were found to have been offering investment contracts without the required registration and approval from the SEC.
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These are F2M Tarlac City-Main, F2M Paalaga System, F2M Tuguegarao, F2M Dagupan, F2M La Union, F2M Lagawe, F2M-Solano Nueva Vizcaya and F2M Tayug.
The activities were done through F2M’s so-called 3 Months Paalaga System, through which F2M and the other entities encouraged potential investors to buy one piglet for P5,000 and promised a 30-percent return on investment and less 5 percent service charge, the SEC noted.
In the revocation order dated Oct. 9, 2024 but made public only on Jan. 6 this year, the SEC Enforcement and Investor Protection Department (EIPD) pointed out that this was tantamount to an investment contract.
Under the Securities Regulation Code, an investment contract involves paying capital “to secure income or profit from its employment.” Securities must also be registered with the SEC before these are offered to the public.
“It has been applied to a variety of situations where individuals were led to invest money in a common enterprise with the expectation that they would earn a profit through the efforts of the promoter or of someone other than themselves,” the SEC EIPD said in its order.
The commission first issued an advisory against F2M Agri-Farm in April 2024. The regulator later issued a cease and desist order last Aug. 20 to stop the company from soliciting investments.