Scams, greed and shady deals

HAPPY WEEKEND

Gina Dizon

SAGADA, Mountain Province -- “There’s a sucker born every minute,” an adage attributed to showman Phineas Barnum tells that this world does not run out of con men and victims. People don’t learn and they are duped by enticingly attractive schemes and become victims every now and then. Towards the end, the big blame is on the scammed victim for consciously getting  conned and his money taken by the scammer. Systems have to be in place to prevent this human nature of greed and illegal act. Here in this tourist town of Sagada visited by some 170,000 tourists a year, are visitors who come with other purposes aside from visiting the most visited Bumod-ok falls or Sumaguing cave.

Four transient visitors from Quezon City, Bulacan and Rizal stayed in one of the inns in Sagada for quite some time early this year  till July 10 when they attempted to leave Sagada.

Their infamous flight though was aborted after the landlady noticed their room was vacated and reported their leaving to the police leading to their interception at Sinto, Bauko.

Within their stay, the visitors have been recruiting investors among women vendors in the central town and even some women tourist guides at northern Sagada.  

Four men who claimed they belonged to a certain Intensity 8 General Merchandise offered an enticingly attractive 30% interest for 40 days’ scheme the investors readily grabbed.  An estimated P3 million-peso investment added up from a number of eager investors who gave their money to the investing company.

Indeed, for anyone who wants money the easy way falls into “double your money” schemes at high interest returns beyond bank rates.  That is, far beyond legal mutual funds which grow between 5% to 9% and government securities like T-bills and T-bonds yielding at most over 6%.

Investing in pyramiding and Ponzi-like schemes could get you carted away.

It’s plain gambling with the investor hoping he will get high interest rates. But it doesn’t happen that way. Just like any other pyramiding and Ponzi schemes eventually collapse with no more interest pay-outs. Some investors wisely dismember themselves early after having taken some huge amount. Investors decrease in number or stay stagnant resulting to decrease in income and the collapse of the company.

Where investors’ money is used for staff salaries and operators’ perks, the company shall surely die out. Like Pastor Joel Apolinario heading the infamous pyramiding Kapa Community Ministry International, investors’ money was used to finance nine luxury vehicles for his family use.

Back here in Sagada, police could have filed charges of syndicated estafa against the alleged Intensity 8 scammers. Charges however was aborted with the desistance of the scammed victims.

Along with the desistance was an agreement for brokers to pay within a month. Greed takes its toll even up to the moment of desistance that hope still lingers among the scammed that scammers shall pay back.

So goes the frustrated statements of some ‘ka-ilyan” in Save Sagada Facebook page that charges should have been filed before the brokers were released.

Or at least one of the four suspects could have been detained as security aside from the Nissan Almera as a guarantee for operators to come back and a P500,000 post-dated check issued to one of the investors. 

To include in the drama was a certain Col Gawiran and an alleged Iglesia ni Cristo pastor who intervened in behalf of the brokers and accompanied them in leaving Sagada after the settlement.

Are they for real?  A military man and a pastor- and what role do they play in shady business deals is a question.  

The alleged scammers will not come back anymore is the big hunch.  And if that happens, treat it as a bad dream. Or even now, treat it as a bad dream.

Where shall scammers get the money to pay back their investors is the big, big question. Get a loan? Borrow money from friends or relatives? Take it from other investors? Scam some more? Scamming is the source of income of scammers.

If the scammers come back and pay the waiting investors, it will  be a surprise.

The big question remains: why were they released with no strong guarantees? A post-dated cheque may bounce. The Nissan Almera may belong to someone else as rent-a-car.

Besides, the car has no registration papers left to any of the scammed victims.   

While filing charges is the way out to get one’s money back, the scammed has all the blame for a doubly onerous and illegal act one has entered into in the first place.  

To repeat, interest rates were exceedingly high beyond regular bank rates. Secondly, the scheme was illegally pyramidal where one gets 5% from any referral’s investment so the more referrals the better.  

This is against the Securities Regulation Code prohibiting pyramiding schemes. Section 26 of the law prohibits Ponzi-like schemes -- an investment program that offers impossibly high returns and pays investors using the money contributed by other investors.

The Good Book talks about greed as one among the seven deadly sins one shall be divinely punished for.

In government law, if a company registered with SEC violates Sections 8 and 28 of the SRC or perpetration of an investment scam, its principals should be punished.   

Section 8 of the SRC prohibits the sale or distribution of securities without a registration statement duly filed and approved by the SEC.

Section 28 prohibits any person from engaging in the business of buying or selling securities in the country as a broker or dealer, or act as a salesman, or an associated person of any broker or dealer unless registered with the SEC.

Not all scamming investment companies though are registered with SEC, Department of Labor and Employment (DOLE) or Department of Trade and Industry (DTI) and some leave no paper trails. So scammer/s fall into charges of estafa whether multiple or syndicated.

Some three years ago, the SEC listed 41 entities were monitored for Ponzi business and online pyramiding schemes in the Cordillera.

Twenty-one of these investment companies are located in Benguet and nine in Baguio. The rest are in Lagawe, Ifugao and in Bontoc, Mountain Province. Majority of these companies offer high interest rates ranging from 24 up to 40 percent “double your money” schemes. Satarah Wellness, Stiforp Trading and Bitcoin are popular pyramiding names so far. 

It was not long ago when the infamous Linecard hit the streets years ago. Phone cards were used as the product of a pyramiding scheme which eventually collapsed. Here in Sagada was a reported P21 million that was lost to scammed Linecard investors with some brokers who are from Sagada.

It was not very long ago in the ‘70s when Dimensional scammed folks with 'double your money’ offer in Sagada. . And another scam followed. And people just didn’t learn!

SEC has long warned the public on pyramiding schemes including internet based scams which have no permits, no business address and no paper trails.

Because pyramiding and estafa are not heinous crimes, individuals arrested for multiple estafa in relation to investment and pyramiding scams easily post bail.
While we blame the too eager investor and make sure the scammers are sent to jail, some ordinances and government functions protect the community from falling into hands of unscrupulous scammers.

Negosyo centers are some of the activities of the Dept. Trade and Industry to include education sessions among the public to know what pyramiding business schemes are and that these are illegall.

Sagada has a municipal ordinance mandating barangay local government units to let transient visitors register their names, duration and purpose of their stay in town, and to monitor them.  

The ordinance also mandates that outsiders’ business permits should be checked aside from residents’ business licenses.  Sagada has an investment code that protects local business with a number of thriving local cooperatives.

It is a wonder how Intensity 8 managed to operate for some months. They were not discovered to have fled and subsequently arrested, they could have left town with all of their belongings and continued scamming people in other parts of the country.     

Lee Baniaga of Save Sagada Facebook urged innkeepers and house owners to report suspicious business activities of long - staying transients to the authorities.

This, while traffic man Jerry Fatiig says there has to be police outposts in exit points from town.