SEC files criminal complaint vs casino junket operator

MANILA, Philippines — A criminal complaint has been filed by the Securities and Exchange Commission (SEC) against the group of casino junket operator Hector Aldwin Liao Pantollana.

The SEC said it has filed before the Department of Justice last May 31 a complaint against the group for allegedly engaging in unlawful activities linked to money laundering.

The commission charged Pantollana’s Philippine National ESports League, Horizon Players Club and Team Z with violations of the Securities Regulation Code (SRC) and the Anti-Money Laundering Act, as amended (AMLA).

The SEC said the complaint was filed after its Enforcement and Investor Protection Department (EIPD) found the group to be soliciting investments from the public to finance their casino junket operation and casino financing activities.

According to the SEC, the group allegedly issued loan contracts to investors with a promise of guaranteed profit ranging from 60 percent to 111 percent per annum, with the payment of profits and return of capital guaranteed by postdated checks.

“Hector Pantollana’s CJO (casino junket operations) scheme masquerading as a mere contract of loan and secured by postdated checks is clearly an investment contract and undoubtedly, further an evidence of indebtedness. Therefore, a security within the purview of (the SRC),” the complaint stated.

Pantollana’s CJO also has the characteristics of a Ponzi scheme, the SEC said.

Such scheme “lures investors under the promise of big profits and are actually repaid only with the investments coming from the new investors joining the scheme and tends to collapse soon after investors stop joining it,” it said.

The SEC said the Philippine National ESports League, Horizon Players Club and Team Z are not registered as corporations with the commission and have no secondary license that would authorize them to conduct investment solicitation activities from the public.

Under the SRC, the sale or distribution of securities without a registration statement duly filed and approved by the SEC is prohibited.

Brokers and dealers of securities must likewise secure the necessary licenses from the SEC.

Any violation of the provisions of the SRC is considered an unlawful activity or a predicate offense for money laundering under the AMLA.

The SEC has implicated in the criminal complaint the alleged leaders of the casino junket operations as well as those who participated in the investment-taking activities of the Pantollana group.

Further, the SEC has prayed that the DOJ run after the proceeds of the group’s crime and any property used as a means of committing such offenses.

The SEC has issued a cease and desist order against the group as early as March 23, 2023 to stop them from their illegal activities prior to the filing of the criminal complaint.

The order was made permanent in October last year.