Philippine Scams and pyramids
18 March 2008Date Scam Exploded: 2002
Wealth Damage: P100 billion pyramiding scam, which has victimized at least two million people, including, allegedly, politicians and Cabinet members. In the case of Multitel, unverified reports put the number of investors at 950,000, not including other “layers” of officials in the pyramid firm.
Multitel of Rose Baladjay: Multinational Telecom Investors Corp., a domestic company registered with the Securities and Exchange Commission in 1988, started under the name of Ariolite Enterprises International Corp. In August 2000, the SEC approved the company's change of name and its primary purpose as a lending investor, provided that its borrowings would not come from more than 19 lenders. It was the brainchild of Rosario "Rose" Baladjay (then 36) nee Austria, married to another ex-Eastern Telecom employee, a certain Saturnino "Ninoy" Baladjay.
SEC chairperson Lilia Bautista said she had received reports that Multitel was enticing the public to invest in conduit companies named "Everflow" and "One Heart" by offering a 10-percent return on investment, or double the five percent that similar companies offered. It was supposed to be a small lending company, not allowed by law to have more than 19 investors. Companies with 20 or more lending investors are considered to be engaging in public enterprise and therefore require permission from the Securities and Exchange Commission
Mechanics: 4% to 5% every month.
Prior to getting legal cover for its pyramiding activities through Multitel, Baladjay admitted during the Senate hearing, she operated for 12 years without a license.
The so-called “Queen of Pyramiding” started the “underground” lending activities in 1988, when she solicited what she called “voluntary investments” ranging from P2,000 to P10,000 with interest payment of 1.08 percent monthly, or more than 12 percent per annum. Then, she reloaned the money to businessmen at a rate of 2.5 percent a month, or 30 percent per annum.
Her “investors” were given postdated checks.
After forming Multitel in 2000, the company attracted investors by offering a 4 percent guaranteed monthly interest for a minimum investment of P10,000. As an alternative, it offered an attractive “double-your-money” come-on to investors who chose the 18-month lock-in scheme.
Thousands of counselors were conscripted to recruit investors, who were given commissions ranging from 1 percent to 20 percent for their efforts. These commissions serve as incentives for the counselors to recruit others, called subcounselors, to expand and extend their recruitment up to four levels or “downlines.”
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Date Scam Exploded: July 12 2007 as early as SEC warning
Wealth Damage: Unconfirmed amount because time in existence was short, and was internet based. An unconfirmed number between 10,000 and 25,000 were alleged to have been victimized in this scam
SMFund - The site SMFund.com (www.smfund.com, sminvestment.com) is not registered by the SEC nor is not legitimately operated by SM Investments, according to executives of SEC, SM and the Anti-Money Laundering Council. Holding nothing sacred in their bid to associate themselves with the SM Investment group, they even require deposits to their funds be made thru BDO Banco De Oro Bank owned by Sy Family's SM Investments.
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Date Scam Exploded: June 21 2007 when web server was closed
Wealth Damage: P1 billion
FrancsSwiss - with websites at [www.francswiss.com | www.francswiss.us | www.francswiss.biz] — is an HYIP that offers 4.5% interest per day for 60 days on a minimum investment of $1,000. It is not fully explained, however, how they are able to generate enough profits that would compensate for such abnormally high return.
Based on the Interpol data, FrancSwiss – which promotes an easy-money making scheme done through the Internet – is located in Utah, United States but it is sub-based to several users.
People behind the scam: The NBI said other known FrancSwiss personalities have now been placed under their "Wanted List." They include Jaime Poliquit (Davao City), Garry Espiritu (Metro Manila), alyas Jomarc (Fairview, Quezon City), Edwin Sendana (Pasig City), and Edward Ricalde (Pampanga).
They claimed :
Chief Financial Officer – Michael Mansfield
Principal guaranteed by Swiss Mutual Fund(1948)
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Date Scam Exploded: July 19-26, 2007
Wealth Damage: $250-million
Length of operation: PIPC has been in operation for nine years and most of its investors were really big-time. There were those who claimed to have invested as much as $6 million
Mechanics: Senator Roxas said PIPC Corp. was registered as a research company, yet it actively sought prospective clients of investment products worth at least $40,000 each, with a promised high return of 12-15% annually. These investments were, however, executed with Performance Investment Products Corporation in British Virgin Islands, which is not licensed to do business in the Philippines.
PIPC- Performance Investment started in the late ’90s as Performance Foreign Exchange Corp. (PFEC), with Liew taking in on board an ex-Allied Bank officer in Singapore, Roberto Borromeo, to help the venture hurdle the thicket of local regulatory rules.
The forex venture did immediately run into opposition from the Securities and Exchange Commission, which sued all the way to the Supreme Court, only to suffer a loss after the Bangko Sentral sided with Performance.
Even before the July 2006 favorable SC decision, Performance had already found sympathizers within the Bangko Sentral.
Liew was even accompanied by then Monetary Board Member Melito Salazar when Performance launched its Cebu branch in 2004 in ceremonies at the Marriott Hotel.
Borromeo, who admitted having already heard of the Performance implosion earlier this week, said he and Liew parted ways sometime in 2004, with Borromeo taking control of Performance Foreign Exchange, with offices at The Enterprise on Ayala Avenue, and Liew setting up Performance Investment Products in Citibank building, further down on Paseo de Roxas.
Borromeo sought to distance his company from the similarly named Liew venture, saying his Performance is limited to being an Internet-based financial intermediary, with clients themselves doing the foreign exchange trading using Performance’s software for a fee.
Personalities involved according to Investmentbankersonlife.com :Michael H. K. Liew-
According to the Singapore Straits Time, "Mr. Liew was the principal donor to the renovation of part of the obstetrics and gynaecology wing of the Philippine General Hospital in Manila. He led the ribbon-cutting at the inauguration last August and was presented with a plaque for his philanthropy. The hospital's website said Mr Liew dedicated the project to the memory of members of his family who perished in Phuket, Thailand, in the December 2004 tsunami."
GMANews.TV had reported that he left the country on June 20 and that his $2 million account in a Hong Kong bank had been blocked by Hong Kong authorities when he attempted to transfer funds to another bank account, after they were alerted by Singaporean authorities about Mr. Liew's questionable trading activities.
Cristina Gonzalez-Tuason, the whistle-blowing general manager of PIPC, used to live in Wack Wack Subdivision, but she doesn’t live there any longer. She has reportedly moved to Dasmariñas Village in Makati for security reasons.
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Date Scam Exploded: End of February 2008 when checks bounced. and March 4 when owner Cyrus Hao fled the country
Wealth Damage: P2-billion
Royal Manchester Five Trading Corporation RMF
Cyrus Yap Hao, the missing president and chief executive of Royal Manchester Five, was among those who worked with Baladjay in the pyramiding operations of Multinational Telecom Investors Corp., they said.
Hao started recruiting people for his own pyramid operation shortly after Multitel was shut down with Baladjay’s arrest in 2003.
Hao started off with his close friends Joesedev Colina, Edwin Rosas, Joseph Bualoy and Rowena Uy, and incorporated Royal Manchester Five.
The five incorporators hired people including Renato San Juan, who was made vice president of marketing, and his wife Zorayda.
Under San Juan were people in multi-level networking, such as Mytextbiz, which was involved in a mobile phone loading network, and Powerhomes Unlimited Corp., which allegedly victimized Filipino contract workers by promising them an opportunity to own a house and lot package by paying an enrolment fee of $298.
Members were promised monthly incomes that progressively increased—and up to P3 million on the 12th month—which would allow them to acquire a house and lot at no further expense provided they recruited other people.
San Juan’s top agents who came from these networking firms were Eric Magtabog, Angelina Mendoza and husband Noel, Eric Ungsod, Harry Soriano, Ferdinand Tolentino and Dennis Abarra, who were called Royal Manchester Five’s “marketing professionals.” They persuaded people to invest money in currency trading in Denmark and other European countries.
For each client’s investment, the top agents received 8 percent commission and the San Juans 9 percent.
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draggy, methinks the SM Fund and FrancSwiss Mutual Fund are the same folks.
i see mtm. and i heard theyre trying to resurrect a branch of abba deo and rmf