THE Securities and Exchange Commission (SEC) has warned against investing on Trade City-Mall, which uses an online platform for its supposed online job offer but its operation is akin to Ponzi scheme.
The SEC said the company was using the tasking and recharging scheme, in which it entices the public into opening an account for an online job.
Once this was completed, the public is asked to communicate with Rebeka Clarah, an assistant manager of Trade City Mall, for the gathering of personal information.
“For a certain amount of money, the public is asked to perform a “Level 1” or “VIP 1” task and required to grab three orders in their platform for a promise of receiving monetary rewards or what they call ‘commission,’” the regulator said.
Once the “VIP 1” task is completed and upon withdrawal of the monetary reward, the investor is asked to recharge and upgrade his level into “VIP 2” where the investor will be required to perform another task. The latter includes “grabbing” five orders for a promise of earning commission equivalent to 30 percent per order. A “VIP 3” level, meanwhile, promises a return after completing seven orders but with a higher recharge amount.
“Lastly, after the accomplishment of all the assigned tasks, the investor will be informed that in order to collect the promised amount of commissions, a certain amount of tax must be paid,” the SEC said.
The Regulator said the company is presenting a fake certificate of registration, as a way of enticing the public to invest in them.
The SEC said Trade City-Mall is not authorized to solicit investments from the public as these entities did not secure prior registration and license to solicit investment from the agency.
Its tasking and recharging scheme involves the offering and sale of securities in the form of investment contracts, as there is an investment or placement of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others, the SEC said.
The regulator added that Trade City-Mall’s operation has the characteristics of a Ponzi scheme where moneys from new investors are used in paying fake profits to prior investors and is designed mainly to favor its top recruiters and prior risk takers and is detrimental to subsequent members in case of scarcity of new investors.
“The public is hereby advised to exercise caution in dealing with any individual or group of persons soliciting investments for and on behalf of Trade City-Mall. The public is further advised not to invest or to stop investing in the investment scheme being offered by the subject entities or its representatives,” the SEC said.