1M Filipinos lost P25B to investment scams

One in every 100 Filipinos has fallen prey to various investment scams that lure people with hefty returns in a short period of time, wiping out more than P25 billion worth of hard-earned money to date.

Lalaine Monserate, assistant director in charge of investigations and prosecution at the Securities and Exchange Commission (SEC), said in a briefing yesterday that the most prevalent scams were done through the “Ponzi” and “pyramiding” schemes.  Based on conservative estimates, she said as many as one million Filipinos have been victimized by investment scams. This estimate based on reports reaching the SEC rather than the actual number of complainants was equivalent to about 1 percent of the Philippine population.

“I can’t really explain to you how it feels to be a victim of a scam. Ordinary people—farmers, retired government employees, retired janitors—coming to you and telling you ‘my retirement pay has been invested in a supposedly legitimate business company but it turned out that the company is a fly-by-night corporation and the money is all taken by the scammer,’” Monserate said in a forum held by Sun Life of Canada, which launched an anti-scam campaign yesterday.

Unfortunately, she said there was a rising trend among young people victimizing the older citizens under the guise of being newly minted millionaires. Victims come from A, B or C income segments, including the well-educated.

She also warned against tech-savvy scammers increasingly using the Internet and social media to lure yield-seeking investors who were sometimes “too trusting” that they would give their money even without face-to-face interaction. “The Internet and social media have become a nightmare for us,” she said.

Two of the biggest scams in the Philippines involved Performance Investments Products Corp. (PIPC) and Aman Futures Group, each of which had siphoned off about P12 billion in investments. There have been no court convictions yet of fraudulent acts in the country but Monserate noted that there were ongoing hearings such as in the case of Rosario “Rose” Baladjay of the Multinational Telecom scam.

In the case of Cesar delos Angeles of the Legacy group, touted as the “Bernie Madoff of the Philippines” but who passed away without any conviction, she said the civil cases could still continue but noted that very little assets have remained to cover the victims.

In the case of a Ponzi scam, she said this was an investment fraud which promised high financial returns or dividends equivalent to 6-29 percent a month.

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