The Securities and Exchange Commission (SEC) has filed criminal charges anew before the Department of Justice (DOJ) against the officers of two other companies affiliated with the Legacy Consolidated Plans Inc. for violation of the provisions of the Securities Regulation Code (SRC), which prohibits the sale of securities without prior approval of the commission.
In two separate complaints, the SEC-Compliance and Enforcement Department accused the officers of Legacy Card Inc. (formerly known as Legacy Group Inc.) and One Realty Corp. of violating Sections 8 and 26 of the SRC, as well as Section 45 of the Corporation Code.
The SEC named as respondents Celso de los Angeles Jr., former chairman and chief executive officer and director of Legacy; Martin Nicolo de los Angeles, Victorino de los Angeles, Purita de los Angeles, board of directors of Legacy Card; Norman Tiongson, corporate secretary; Corilina Hinola, Christine Antenor Cruz, SVP-finance officers; Rita Maniacup, AVP-finance officer; Basilio Ponciano Carpio, senior manager; Roy Hilario, director and authorized representative; and several John and Jane Does.
On the other hand, aside from Celso de los Angeles, other officers of One Realty Corp. charged were Ma. Concepcion de los Angeles, Purita de los Angeles, Christine Limpin, Madeline Cobarrubias, all board of directors.
The SEC claimed that the accused actively participated in the fraudulent activities of Legacy Consolidated Plans, which has previously been charged before the DOJ by the SEC.
Meanwhile, the SEC has issued a cease-and-desist order (CDO) against the controversial Legacy Consolidated Plans and affiliated companies, stopping them from selling properties and other assets without prior written approval from the corporate regulator.
Apart from Legacy Consolidated, other companies slapped with a CDO are Legacy Card Inc., Galaxy Realty & Holding Inc., Shining Armor Property Inc. One Realty Corp. and One Card Co. Inc.
In issuing the CDO, the commission used as basis the findings of its compliance and enforcement division (CED), which said that “after proper investigation, it appears that the aforementioned corporations through their sales-agents/salesmen enticed the investors to invest in their various investment contracts, such as double-your-money program, mutual fund, preneed buy- back with deed of assignment, motor vehicle with money back, Maxicore and other bank products, like certificate of time deposit and one-card international credit card.”
The CED added, “Unfortunately, it further appears that Legacy Consolidated has no license to offer securities to the public. Neither subject corporations’ sales agents/salesmen are duly licensed to offer to sell securities to investors. Such acts violate the Securities Regulation Code [SRC] and its Implementing Rules and Regulations. Worse, the offices of subject corporations, their affiliates or related companies already closed shop.”
The SEC order, however, stated that all persons affected by the CDO may, within a nonextendible period of five business days from receipt of the order, file a formal request or motion for the lifting of the order.
In its complaint filed with the DOJ, the SEC alleged that Legacy Consolidated Plans offered and sold various investment schemes as “shares, participation or interest in a corporation or in a commercial enterprise or profit-making venture.”
Such investment contracts, according to the SEC, are required under Section 8 of the SRC to be registered before being offered or sold to the general public, which Legacy failed to comply with.
The SEC said Legacy committed fraud when it enticed the public to participate in these investment schemes with the assurance that they will earn huge profit in three years and that the investment would surely be paid because they are issued postdated checks payable in equal monthly or quarterly installments.
But instead of fulfilling its promise, Legacy closed its offices and filed for dissolution before the commission.
To evade its obligation for the payment of the investments made by its investors, Legacy Consolidated Plans used its affiliates, such as the respondents Legacy Card and One Realty Corp., as business conduits for the purpose of issuing and assuming liability for payment of the postdated checks given to the complainant-investors.