SEC-NBI team raids Multitel, Everflow offices

A joint team composed of representatives from the Securities and Exchange Commission and the National Bureau of Investigation raided the corporate offices of Multitel International Holdings. Inc., MMC Investment & Financial Management Inc. and the Everflow group of companies by virtue of the search warrants issued by the Makati Regional Trial Court.

The search warrants were issued by Judge Maria Cristina Cornejo of branch 147 of the Makati RTC on the basis of findings that these firms had violated the Securities Regulation Code when it sold shares without prior registration with the SEC.

The three corporations are/were previously linked to Multinational Telecoms Investors Corp. which was issued a cease-and-desist order by the SEC last Jan. 20 for engaging in the unauthorized sale of securities.

Citing Section 8 (1) of the SRC, the SEC said no securities shall be sold or offered for sale or distribution without a registration statement duly filed with and approved by the agency.

The modus operandi of these firms is to solicit investments from the public by offering high interest rates ranging from 10 to 15 percent for minimum placement of P50,000 for a period of three to six months.

Based on the submitted list of investors of Multitel as of Feb. 16, 2001, Multitel had 238 investors/lenders with an aggregate exposure of P11.1 million.

Multitel is not authorized to sell shares to the public as its primary license allows it only to manufacture batteries, battery parts and accessories and other related or allied goods of similar nature.

Other companies reportedly used by Multitel in soliciting investments from the public and which are covered by the CDO issued by the SEC are Partners in Progress Holdings Inc., Sage Management Corp., CUP Multi-Purpose Cooperative Inc., Multilink Multi-Purpose Cooperative Inc., Oceanic Employees, Bethel Multi-Purpose Cooperative, Goodwill Development Cooperative, and Handog sa Pag-unlad Multi-Purpose Cooperative.

Multitel and MMC’s offices are located at the Enterprise Tower while the Everflow groups’ office is at the Electra House Building.

The CDO against Everflow and Multitel had already been made permanent, meaning that these companies should no longer be operating and seeking investments from the public.

The SEC, however, received reports that these companies continued to accept investments or placements from the public despite the CDOs issued by the regulatory agency.

Tomas Syquia, head of the SEC’s Compliance and Enforcement Department, earlier said those found to have invested again in these companies would be considered conspiring with the firm and thus be held liable for violation of the securities law.

The CED, he said, is now preparing to revoke the corporate franchise of Multitel to prevent the company from further defrauding the public. It is also looking at filing a criminal complaint against the company.

The Everflow group denied selling shares of stocks at 10 percent to 15 percent interest, saying they only acted as Multitel’s financial consultant for a very limited period.