Swamped with reports that a number of companies continue too operate and solicit investments from the public despite the issuance of a CDO against them, the SEC is considering hooking up with the PNP to ensure the faithful implementation of its orders.
"Maybe we need to sign something with the PNP to ensure better coordination and the implementation of our CDOs. We need police force unless government gives us police force," SEC Chairperson Lilia R. Bautista said.
The PNP can provide assistance by serving orders or search warrants to erring corporations.
Several companies, including Multinational Telecom Investors Corp. (Multitel), have been continuing to engage in unauthorized sale of securities despite the SECs issuance of a CDO against them.
Multitel has come under fire from the SEC for selling investment contracts and securities to the public without prior approval. It offers high interest rates of as much as 15 percent a month for a minimum investment of P10,000.
The SEC and the National Bureau of Investigation earlier signed a memorandum of understanding (MOU) to jointly undertake surveillance, investigation and prosecution of violations of securities rules and laws.
The MOU was intended to address the growing number of boiler-room operations in the country.
The modus operandi of boiler-room operations is to employ telemarketers and foreigners who as unregistered brokers offer exorbitant returns on investments and fraudulently sell securities in unregistered transactions.
A boiler-room operates with only minimal legitimate business activities its primary activity is to raise investor funds which will then be pocketed by the principals and telemarketers in the form of commissions, costs and fees.
With the investigation and enforcement expertise of the NBI coupled with the technical knowledge of the SEC, both agencies want to send a strong message to the public that they will clamp down on any securities fraud operations and will not hesitate to enforce the full force of the law.
The NBI will provide the jail for those who will be found guilty for violation of the securities law.
The signing of the MOU was spurred by the rising number of Philippine-registered corporations being used by transnational elements with dubious identities to defraud gullible investors.