THE Securities and Exchange Commission (SEC) has revoked the certificates of incorporation of ScentKoWorld Corp. and Brendahl Cruz Holdings, Inc. for illegally selling securities to the public.
In its revocation order, the SEC found the two companies to have been promising the public a 400% return for investing in their “buy and earn” programs.
“Under its investment scheme, ScentKoWorld entices the public to buy perfume and beauty products in exchange for ‘cash sales rewards’ equivalent to 400% of the purchase price. Hence, their member was promised a return of P20,000 for simply buying a package worth P5,000,” the SEC said.
“Also, their members may receive the promised return in about 30 days, without having to resell the products, depending on how soon ScentKoWorld can recruit new members. Accordingly, the company encourages its members to recruit others as well. And lastly, ScentKoWorld promises a referral fee equivalent to 10% of the amount invested by the new member,” it added.
The SEC said the investment scheme has the characteristics of an investment contract, which must first be registered with the commission before it is offered and sold or distributed to the public.
The regulator found that ScentKoWorld and Brendahl Cruz Holdings have not registered any securities that would allow them to offer or sell securities to the public and that they are not licensed capital market professionals such as, among others, securities…