SEC poises CDO against Everflow

The Securities and Exchange Commission (SEC) is set to issue a cease-and-desist order (CDO) this week against the Everflow group of companies for soliciting investments from the public although it is not licensed to do so.

This followed a recommendation from Tomas Syquia, head of the Commission’s Compliance and Enforcement Department, to the SEC en banc, for the issuance of the CDO on Everflow for selling securities that were not registered with the commission.

"We have already asked the Commission en banc to approve our recommendation. We have sought the issuance of the CDO against the group," Syquia said, adding the SEC move is intended to protect the public from firms engaged in the illegal solicitation of investments.

Everflow International Management and Everflow Holdings have offices at the Electra House ground floor in Legaspi Ave. The firms, headed by spouses Felix and Iris Aquino, are into financial holding activities.

The CED found out that the Everflow group is offering 10 to 15 percent interest monthly for a minimum placement of P50,000, the rates quoted by ICS Exports which closed shop leaving investors that include firemen and policemen, with losses of at least P1.2 billion.

Spouses Emilia and Ferdinand Sison, who headed ICS Exports, were reported to have fled the country and that investigation points to a pyramid scam which ICS reportedly perpetrated on the unsuspecting investors.

SEC officials reiterated their warning to the public not to fall victim to offer of 10 to 15 percent monthly interest, especially in the light of the proliferation of pseudo investment corporations, bogus foundations and foreign currency futures exchange companies.

They said that pyramid scams usually offer high interest rates and that they rely on the investors of those down below to pay for those at the top of the pyramid. However, once, the chain is broken, the investors will be left holding worthless certificates of investment.

This is what happened to ICS Exports when the investors sensed the pyramid scam thereby resulting in its eventual collapse.

In an advisory, the SEC said companies cannot just issue investment contracts since they need a secondary license from the commission.

Meanwhile, the Everflow group welcomed a move by the (SEC) to investigate companies that are involved in fraudulent business activities, particularly in the illegal sale of securities.

In a press statement, Everflow director and merchant marine Capt. Felix C. Aquino said their company would even ask SEC to probe other companies that are still actively engaged in such scams.

Reports say that the SEC is looking into the operations of 20 companies that are allegedly wooing the public to invest their money in some companies that promise interest rates of up to 15 percent a month. The same reports say that one of these companies is Everflow.

Aquino said they have never been engaged in such activities.

He said Everflow was actually one of the many financial consultants of Multinational Telecoms Investors Corp. (Multitel) – a company that had been ordered by the SEC in January 2002 to cease and desist from offering and selling unregistered securities to the public.

Aquino said Everflow, believing that Multitel is a legitimate business entity, acted as its financial consultant for a very limited period.

When the SEC issued the cease and desist order, Everflow immediately asked Multitel to explain why the latter was being ordered to stop from operating.

Multitel was unable to explain the reasons behind SEC’s cease and desist order, prompting Everflow to stop rendering its services.

Aquino also said Everflow is not selling shares of stocks at 10 percent to 15 percent interest or return of investments as reported in the media.

While Everflow acknowledges the power of SEC to run after companies engaged in payramiding and various types of multi-level marketing that defraud the public by siphoning their money, Everflow maintains that it should not be investigated on the first place, much less be subjected to a cease and desist order (CDO) considering that it is not engaged in any illegal or fraudulent activities.

Everflow is involved in real estate and agri-business.