The Securities and Exchange Commission (SEC) obtained the conviction of the incorporators of Prosperous Infinite Holdings Phils. Body. (SEC: PIPHC), the operator of Emgoldex Philippines, for soliciting investments from the public without the necessary license from the agency.

In a decision dated October 1, 2024, the Pasig City Regional Trial Court Branch 157 found PIPHC incorporator and director John Rafael Calicdan and corporate secretary Ryan Manuit guilty of violating the provisions of the Securities Regulatory Code (SRC).

Manuit and Calicdan were sentenced to up to 10 years in prison and a fine of 500,000 lei each.

Pursuant to its charter, the primary purpose of the PIHPC includes the investment, purchase or acquisition of, among other things, personal property, including stocks, bonds, debentures, notes, evidence of indebtedness, contracts and other securities and obligations of any corporation.

The case stemmed from the agency’s investigation into Emgoldex Philippines, which was found to be involved in online solicitation of investments through investment contracts without the necessary approvals from the SEC.

Under the scheme, the public were encouraged to invest at least £36,500 in its gold investment scheme in return for guaranteed earnings of up to £182,500. Investors are required to recruit at least two more people to make similar investments until they fill the exit table of the hierarchy which consists of 15 slots.

The agency issued a cease and desist order against Emgoldex, where Manuit and Calicdan were among the operators. Emgoldex later changed its trading name to Global Intergold, then PIPHC and continued its illegal solicitation activities.

Like PIHPC, Global Intergold was found to be unregistered with the SEC and did not have a license to sell securities to the public.

“Although the articles of incorporation of PIPHC bore the signatures of both the accused Calicdan and Manuit, they denied being the incorporators of the company and only stated that they signed the same without understanding its consequences, which is highly unlikely considering their participation in the operations of the corporation after its establishment,” the decision said.

“Thus, there can be no doubt that both accused participated in the recruitment of investors and the activities of PIPHC when it dealt in securities without any registration or license from the SEC,” it said.