SPECCOM DIGESTS
Securities Regulation Code (RA 8779)
Xavier University College of Law
|AGOT GAID|
CASE
1. Abacus Securities Corp. Vs. Ampil GR
No. 160016, February 27, 2006
FACTS
Petitioner is engaged in business as a broker
and dealer of securities of listed companies at
the PSE Center.
Respondent Ampil opened a cash or regular
account with petitioner for the purpose of buying
and selling securities. Respondent actively
traded his account, and he accumulated an
outstanding obligation in favor of [petitioner] in
the principal sum of P6.6M as of April 30, 1997.
Respondent failed to pay his obligation on time.
Petitioner thereafter sold respondent’s securities
to set off against his unsettled obligations. After
the sale of respondent’s securities and
application of the proceeds thereof against his
account, respondent’s remaining unsettled
obligation was P3.3 M.
Petitioner then referred the matter to its legal
counsel for collection purposes. For his defense,
respondent claims that he was induced to trade
in a stock security with petitioner because the
latter allowed offset settlements wherein he is
not obliged to pay the purchase price. Rather, it
waits for the customer to sell. And if there is a
loss, petitioner only requires the payment of the
deficiency (i.e., the difference between the
higher buying price and the lower selling price).
In addition, it charges a commission for
brokering the sale.
The provisions governing the above transactions
are Sections 23 and 25 of the RSA16 and Rule
ISSUE
Whether or not the Court of Appeal’s
ruling that petitioner and respondent are
in pari delicto which allegedly bars any
recovery, is in accord with law and
applicable jurisprudence
RULING
YES, but the pari delicto rule applies only to
transactions entered into after the initial trades
made on April 10 and 11, 1997.
The right to collect cannot be denied to
petitioner as the initial transactions were
entered pursuant to the instructions of
respondent. The obligation of respondent for
stock transactions made and entered into on
April 10 and 11, 1997 remains outstanding.
These transactions were valid and the
obligations incurred by respondent concerning
his stock purchases on these dates subsist. At
that time, there was no violation of the RSA yet.
Petitioner’s fault arose only when it failed to: 1)
liquidate the transactions on the fourth day
following the stock purchases, or on April 14
and 15, 1997; and 2) complete its liquidation no
later than ten days thereafter, applying the
proceeds thereof as payment for respondent’s
outstanding obligation
In securities trading, the brokers are essentially
the counterparties to the stock transactions at
the Exchange. Since the principals of the
broker are generally undisclosed, the broker is
personally liable for the contracts thus made.
Hence, petitioner had to advance the payments
for respondent’s trades. Brokers have a right to
be reimbursed for sums advanced by them with
the express or implied authorization of the
principal, in this case, respondent.
1

2. SEC vs. Prosperity. Com Inc. GR No.
164197, January 25, 2012
25-1 of the RSA. Section 23(b) above—the
alleged violation of petitioner which provides the
basis for respondent’s defense—makes it
unlawful for a broker to extend or maintain credit
on any securities other than in conformity with
the rules and regulations issued by Securities
and Exchange Commission (SEC). Section 25
lays down the rules to prevent indirect violations
of Section 23 by brokers or dealers. RSA Rule
25-1 prescribes in detail the regulations
governing cash accounts.
RTC held that parties were in pari delicto and
therefore without recourse against each other.
According to the RTC, by allowing respondent to
trade his account actively without cash,
petitioner effectively induced him to purchase
securities thereby incurring excessive credits.
The trial court also found respondent to be
equally at fault, by incurring excessive credits
and waiting to see how his investments turned
out before deciding to invoke the Revised
Securities Act (RSA).
CA upheld the lower court’s finding that the
parties were in pari delicto. It castigated
petitioner for allowing respondent to keep on
trading despite the latter’s failure to pay his
outstanding obligations. It explained that “the
reason behind petitioner’s act is because
whether respondent’s trading transaction would
result in a surplus or deficit, he would still be
liable to pay petitioner its commission.
PCI sold computer software and hosted
websites without providing internet service. To
make a profit, PCI devised a scheme in which,
for the price of US$234.00 (subsequently
increased to US$294), a buyer could acquire
from it an internet website of a 15-MB capacity.
By referring to PCI his own down-line buyers, a
first-time buyer could earn commissions, interest
in real estate in the Philippines and in the US,
and insurance coverage worth P50K.
Whether or not PCI’s scheme constitute
an “investment contract” that needs
registration pursuant to SRC.
The main purpose of the statute on margin
requirements is to regulate the volume of credit
flow, by way of speculative transactions, into
the securities market and redirect resources
into more productive uses. It is also to give a
government credit agency an effective method
of reducing the aggregate amount of the
nation’s credit resources which can be directed
by speculation into the stock market and out of
other more desirable uses of commerce and
industry.
Pursuant to RSA Rule 25-1, petitioner should
have liquidated the transaction (sold the
stocks) on the fourth day following the
transaction (T+4) and completed its liquidation
not later than ten days following the last day for
the customer to pay (effectively T+14).
Respondent’s outstanding obligation is
therefore to be determined by using the closing
prices of the stocks purchased at T+14 as
basis.
NO.The SRC treats investment contracts as
“securities” that have to be registered with the
SEC before they can be distributed and sold.
An investment contract is a contract,
transaction, or scheme where a person invests
his money in a common enterprise and is led to
expect profits primarily from the efforts of
others..
(Not much jurisprudence about “investment
contract in the Phil. So the SC looked into US
2

3. SEC vs. Interport Resources Corp.
GR No. 135808, October 6, 2008
(YOU DO NOTE: This is a 89-page
decision. There are also a thorough
discussions about insider-trading, Material
Fact,” “Reasonable Person,” “Nature and
The PCI buyer must enlist and sponsor at least
two other buyers as his own downlines. These
second tier of buyers could in turn build up their
own down-lines. For each pair of down-lines, the
buyer-sponsor received a US$92.00
commission.
PCI patterned its scheme from that of Golconda
Ventures, Inc. (GVI), which company stopped
operations after the Securities and Exchange
Commission (SEC) issued a cease and desist
order (CDO) against it. As it later on turned out,
the same persons who ran the affairs of GVI
directed PCI’s actual operations.
Disgruntled elements of GVI filed a complaint
with the SEC against PCI, alleging that the latter
had taken over GVI’s operations. After hearing,
the SEC, through its Compliance and
Enforcement unit, issued a CDO against PCI.
The SEC ruled that PCI’s scheme constitutes an
Investment contract and, following the SRC, it
should have first registered such contract or
securities with the SEC.
PCI filed with the CA a petition for certiorari
against the SEC with an application for a
temporary restraining order (TRO) and
preliminary injunction in CAG. R. SP 62890.
The CA ruled that, following the Howey test,
PCI’s scheme did not constitute an investment
contract that needs registration pursuant to R.A.
8799, hence, this petition
BOD of Respondent IRC approved a MOA with
Ganda Holdings Berhad (GHB). Under the MOA,
IRC acquired the entire capital stock of Ganda
Energy Holdings, Inc. (GEHI), which would own
and operate a 102 megawatt (MW) gas turbine
power-generating barge. It also stipulates that
GEHI would assume a 5-year power purchase
WON absence of implementing rules
renders ineffective Revised Securities
Act.
jurisprudence.)
The United States Supreme Court held in
Securities and Exchange Commission v. W.J.
Howey Co.that, for an investment contract to
exist, the following elements, referred to as the
Howey test must concur: (1) a contract,
transaction, or scheme; (2) an investment of
money; (3) investment is made in a common
enterprise; (4) expectation of profits; and (5)
profits arising primarily from the efforts of
others.Thus, to sustain the SEC position in this
case, PCI’s scheme or contract with its buyers
must have all these elements.
PCI’s clients do not make such investments.
They buy a product of some value to them: an
Internet website of a 15-MB capacity. The
buyers of the website do not invest money in
PCI that it could use for running some business
that would generate profits for the investors.
The price of US$234.00 is what the buyer pays
for the use of the website, a tangible asset that
PCI creates, using its computer facilities and
technical skills.The commissions, interest in
real estate, and insurance coverage worth
P50,000.00 are incentives to down-line sellers
to bring in other customers. These can hardly
be regarded as profits from investment of
money under the Howey test.The CA is right in
ruling that the last requisite in the Howey test is
lacking in the marketing scheme that PCI has
adopted. Evidently, it is PCI that expects profit
from the network marketing of its products. PCI
is correct in saying that the US$234 it gets from
its clients is merely a consideration for the sale
of the websites that it provides.
NO. Sections 8, 30 and 36 of the Revised
Securities Act do not require the enactment of
implementing rules to make them binding and
effective.In the absence of any constitutional or
statutory infirmity, which may concern Sections
30 and 36 of the Revised Securities Act, this
Court upholds these provisions as legal and
3
Reliability,” and “Generally Available,” ) contract with NPC.
IRC would acquire 67% of the entire capital
stock of Philippine Racing Club, Inc. (PRCI).
PRCI owns 25.724 hectares of real estate
property in Makati. Under the Agreement, GHB,
a member of the Westmont Group of Companies
in Malaysia, shall extend or arrange a loan
required to pay for the proposed acquisition by
IRC of PRCI. IRC alleged that a press release
announcing the approval of the agreement was
sent through facsimile transmission to the PSE
and the SEC, but that the facsimile machine of
the SEC could not receive it. Upon the advice of
the SEC, the IRC sent the press release on the
morning of 9 August 1994. SEC averred that it
received reports that IRC failed to make timely
public disclosures of its negotiations with GHB
and that some of its directors, respondents
herein, heavily traded IRC shares utilizing this
material insider information.
SEC Chairman issued an Order finding that IRC
violated the Rules on Disclosure of Material
Facts, in connection with the Old Securities Act.
In addition, the SEC pronounced that some of
the officers and directors of IRC entered into
transactions involving IRC shares in violation of
Section 30, in relation to Section 36, of the
Revised Securities Act.
CA determined that there were no implementing
rules and regulations regarding disclosure,
insider trading, or any of the provisions of the
Revised Securities Act which the respondents
allegedly violated. Thus, it ruled that no civil,
criminal or administrative proceedings may
possibly be held against the respondents without
violating their rights to due process and equal
protection.
binding. It is well settled that every law has in
its favor the presumption of validity. Unless and
until a specific provision of the law is declared
invalid and unconstitutional, the same is valid
and binding for all intents and purposes. The
mere absence of implementing rules cannot
effectively invalidate provisions of law, where a
reasonable construction that will support the
law may be given.
To rule that the absence of implementing rules
can render ineffective an act of Congress, such
as the Revised Securities Act, would empower
the administrative bodies to defeat the
legislative will by delaying the implementing
rules; To assert that a law is less than a law,
because it is made to depend on a future event
or act, is to rob the Legislature of the power to
act wisely for the public welfare whenever a
law is passed relating to a state of affairs not
yet developed, or to things future and
impossible to fully know.
Sections 30 and 36 of the Revised Securities
Act were enacted to promote full disclosure in
the securities market and prevent unscrupulous
individuals, who by their positions obtain non-
public information, from taking advantage of an
uninformed public. No individual would invest in
a market which can be manipulated by a
limited number of corporate insiders. Such
reaction would stifle, if not stunt, the growth of
the securities market. To avert the occurrence
of such an event, Section 30 of the Revised
Securities Act prevented the unfair use of non-
public information in securities transactions,
while Section 36 allowed the SEC to monitor
the transactions entered into by corporate
officers and directors as regards the securities
of their companies.
These provisions are sufficiently clear and
complete by themselves. Their requirements
are specifically set out, and the acts which are
enjoined are determinable.
4
4. Cemco Holdings, Inc. Vs. National
Life, GR No. 171815, August 7, 2007
Union Cement Corporation (UCC), a publicly-
listed company, has two principal stockholders—
UCHC 60.51%, andpetitioner Cemco with
17.03%. Majority of UCHC’s stocks were owned
by BCI with 21.31% and ACC with 29.69%.
Cemco, on the other hand, owned 9% of UCHC
stocks. In a disclosure letter BCI informed the
PSE that it and its subsidiary ACC had passed
resolutions to sell to Cemco BCI’s stocks in
UCHC equivalent to 21.31% and ACC’sstocks in
UCHC equivalent to 29.69%.
In the PSE Circular for Brokers it was stated
that as a result of petitioner Cemco’s acquisition
of BCI and ACC’s shares in UCHC, petitioner’s
total beneficial ownership, direct and indirect, in
UCC has increased by 36% and amounted to at
least 53% of the shares of UCC. As a
consequence of this disclosure, the PSE, in a
letter to the SEC inquired as to whether the
Tender Offer Rule under Rule 19 of the IR of the
SRC is not applicable to the purchase by
petitioner of the majority of shares of UCC.
Director Callangan confirmed that the SEC en
banc had resolved that the Cemco transaction
was not covered by the tender offer rule.
Feeling aggrieved by the transaction, respondent
National Life Insurance Company of the
Philippines, Inc. (NLIC), a minority stockholder of
UCC, sent a letter to Cemco demanding the
latter to comply with the rule on mandatory
tender offer. Cemco, however, refused.
A Share Purchase Agreement was executed by
ACC and BCI, as sellers, and Cemco, as buyer.
The transaction was consummated and closed.
Respondent NLIC. filed a complaint with the
SEC asking it to reverse its Resolution and to
declare the purchase agreement of Cemco void
The SEC ruled in favor of the respondent by
reversing and setting aside its Resolution and
directed petitioner Cemco to make a tender offer
for UCC shares to respondent and other holders
of UCC shares similar to the class held by
UCHC in accordance with Section 9(E), Rule 19
1. WON the SEC has jurisdiction
over respondent’s complaint and to
require Cemco to make a tender offer
for respondent’s UCC shares.
2. WON the mandatory tender
offer rule applies only to direct
acquisition of shares in the public
company.
1.YES. In taking cognizance of respondent’s
complaint against petitioner and eventually
rendering a judgment which ordered the latter
to make a tender offer, the SEC was acting
pursuant to Rule 19(13) of the Amended IRR of
SRC, to wit: If there shall be violation of this
Rule by pursuing a purchase of equity shares
of a public company at threshold amounts
without the required tender offer, the
Commission, upon complaint, may nullify the
said acquisition and direct the holding of a
tender offer. This shall be without prejudice to
the imposition of other sanctions under the
Code.
The foregoing rule emanates from the SEC’s
power and authority to regulate, investigate or
supervise the activities of persons to ensure
compliance with the SRC, more specifically the
provision on mandatory tender offer under
Section 19 thereof.
Moreover, petitioner is barred from questioning
the jurisdiction of the SEC. It must be pointed
out that petitioner had participated in all the
proceedings before the SEC and had prayed
for affirmative relief. Petitioner did not question
the jurisdiction of the SEC when it rendered an
opinion favorable to it, such as the 27 July
2004 Resolution, where the SEC opined that
the Cemco transaction was not covered by the
mandatory tender offer rule. It was only when
the case was before the Court of Appeals and
after the SEC rendered an unfavorable
judgment against it that petitioner challenged
the SEC’s competence.
2.NO. Tender offer is a publicly announced
intention by a person acting alone or in concert
with other persons to acquire equity securities
of a public company. A public company is
defined as a corporation which is listed on an
exchange, or a corporation with assets
exceeding P50M and with 200 or more
stockholders, at least 200 of them holding not
less than 100 shares of such company.
5

5. Pua vs. Citibank GR No. 180064,
September 16, 2013
of the Securities Regulation Code.
Petitioner filed a petition with the CA challenging
the SEC’s jurisdiction. CA affirmed SEC. It ruled
that the SEC has jurisdiction to render the
questioned decision and, in any event, Cemco
was barred by estoppel from questioning the
SEC’s jurisdiction.
Petitioners filed before the RTC a Complaint for
declaration of nullity of contract and sums of
money with damages against respondent.
Petitioners had been depositors of Citibank
Binondo. Citibank’s Branch Manager, invited
Petitioner Jose to a dinner party at the Manila
Hotel where he was introduced to several
officers and employees of Citibank Hongkong
Branch. VP Yau of CBHongkong, came to the
Philippines to sell securities to Jose.
WON petitioners’ action falls within the
primary jurisdiction of the SEC.
A tender offer is an offer by the acquiring
person to stockholders of a public company for
them to tender their shares therein on the
terms specified in the offer.Tender offer is in
place to protect minority shareholders against
any scheme that dilutes the share value of their
investments. It gives the minority shareholders
the chance to exit the company under
reasonable terms, giving them the opportunity
to sell their shares at the same price as those
of the majority shareholders.
The SEC and the CA ruled that the indirect
acquisition by petitioner of 36% of UCC shares
through the acquisition of the non-listed UCHC
shares is covered by the mandatory tender
offer rule. This interpretation given by the SEC
and the CA must be sustained. The rule in this
jurisdiction is that the construction given to a
statute by an administrative agency charged
with the interpretation and application of that
statute is entitled to great weight by the courts,
unless such construction is clearly shown to be
in sharp contrast with the governing law or
statute.
SEC and CA accurately pointed out that the
coverage of the mandatory tender offer rule
covers not only direct acquisition but also
indirect acquisition or “any type of acquisition.”
This is clear from the discussions of the
Bicameral Conference Committee on the
Securities Act of 2000, on 17 July 2000.
NO. It falls under RTC jurisdiction.Records
show that petitioners’ complaint constitutes a
civil suit for declaration of nullity of contract and
sums of money with damages, which stemmed
from respondent’s alleged sale of unregistered
securities, in violation of the various provisions
of the SRC and not a criminal case such as
that involved in Baviera (cited by respondent).
It is clear that cases falling under Section 57of
6
Petitioners discovered that the securities sold to
them were not registered with the SEC and that
the terms and conditions covering the
subscription were not likewise submitted to the
SEC for evaluation, approval, and registration.
Asserting that respondent’s actions are in
violation of RA No.8799, entitled the SRC, they
assailed the validity of the subscription
agreements and the terms and conditions
thereof for being contrary to law and/or public
policy.
Respondent filed a MTD on the ground of
violation of the doctrine of primary jurisdiction;
that the merits of the case would largely depend
on the issue of WON there was a violation of the
SRC, in particular, WON there was a sale of
unregistered securities. Respondent contended
that the SRC conferred upon the SEC
jurisdiction to investigate compliance with its
provisions and thus, petitioners’ complaint
should be first filed with the SEC and not directly
before the RTC.
Petitioners opposed maintaining that the RTC
has jurisdiction over their complaint. They
asserted that Section 63of the SRC expressly
provides that the RTC has exclusive jurisdiction
to hear and decide all suits to recover damages
pursuant to Sections 56 to 61 of the same law.
the SRC, which pertain to civil liabilities arising
from violations of the requirements for offers to
sell or the sale of securities, as well as other
civil suits under Sections 56, 58, 59, 60, and 61
of the SRC shall be exclusively brought before
the regional trial courts. It is a well-settled rule
in statutory construction that the term "shall" is
a word of command, and one which has always
or which must be given a compulsory meaning,
and it is generally imperative or
mandatory.Likewise, it is equally revelatory that
no SRC provision of similar import is found in
its sections governing criminal suits; quite the
contrary, the SRC states that criminal cases
arising from violations of its provisions should
be first referred to the SEC.
Therefore, based on these considerations, it
stands to reason that civil suits falling under the
SRC are under the exclusive original
jurisdiction of the regional trial courts and
hence, need not be first filed before the SEC,
unlike criminal cases wherein the latter body
exercises primary jurisdiction.

RTC denied respondent’s MTD. It noted that

petitioners’ complaint is for declaration of nullity
of contract and sums of money with damages
and, as such, it has jurisdiction

CA reversed and set aside the RTC’s Orders and

dismissed petitioners’ complaint for violation of
the doctrine of primary jurisdiction. The CA
agreed with respondent’s contention that since
the case would largely depend on the issue of
whether or not the latter violated the provisions
of the SRC, the matter is within the special
competence or knowledge of the SEC.

7
6. People vs. Tibayan, GR Nos. 209655-
60, January 14, 2015
7. Primanila Plans Inc. Vs. SEC GR No.
193791, August 6, 2014
Tibayan Group Investment Company, Inc.
(TGICI) is an open-end investment company
registered with the SEC on 2001. On 2002, the
SEC conducted an investigation on TGICI and its
subsidiaries. In the course thereof, it discovered
that TGICI was selling securities to the public
without a registration statement in violation of
Republic Act No. 8799 and that TGICI submitted
a fraudulent Treasurer’s Affidavit before the
SEC.
On 2003, the SEC revoked TGICI’s corporate
registration for being fraudulently procured. The
foregoing led to the filing of multiple criminal
cases for Syndicated Estafa against the
incorporators and directors of TGICI.
RTC issued six (6) separate decisions convicting
Tibayan of 13 counts and Puerto of 11 counts of
estafa. CA modified accused-appellants’
conviction to that of Syndicated Estafa, and
accordingly, increased their respective penalties
to life imprisonment for each count. SC affirmed
the conviction.
Primanila then operated as a pre-need company
and maintained a business office in Makati City.
On April 9, 2008, the SEC was prompted to
issue the subject cease and desist order after an
investigation conducted by the SEC’s
Compliance and Enforcement Department
(CED) on Primanila yielded the following factual
findings duly explained in the cease and desist
order(CDO):
1. The office of located at 20th Makati City was
closed. No notices were posted outside said
office to inform the public of the reason for such
closure. x x x 2. [Primanila]’s website
(www.primanila.com) was offering a pension plan
product called Primasa Plan. According to the
website, applicants and planholders can pay
What is a Ponzi Scheme.
Whether or not a hearing is required for
the issuance of a CDO.
A Ponzi scheme is a type of investment fraud
that involves the payment of purported returns
to existing investors from funds contributed by
new investors. Its organizers often solicit new
investors by promising to invest funds in
opportunities claimed to generate high returns
with little or no risk. In many Ponzi schemes,
the perpetrators focus on attracting new money
to make promised payments to earlier-stage
investors to create the false appearance that
investors are profiting from a legitimate
business.
It is not an investment strategy but a gullibility
scheme, which works only as long as there is
an ever increasing number of new investors
joining the scheme. It is difficult to sustain the
scheme over a long period of time because the
operator needs an ever larger pool of later
investors to continue paying the promised
profits to early investors. The idea behind this
type of swindle is that the “con-man” collects
his money from his second or third round of
investors and then absconds before anyone
else shows up to collect. Necessarily, Ponzi
schemes only last weeks, or months at the
most.
NO. The authority of the SEC and the manner
by which it can issue cease and desist orders
are provided in Section 64 of the SRC : The
Commission, after proper investigation or
verification, motu proprio, or upon verified
complaint by any aggrieved party, may issue
a cease and desist order without the necessity
of a prior hearing if in its judgment the act or
practice, unless restrained, will operate as a
fraud on investors or is otherwise likely to
cause grave or irreparable injury or prejudice to
the investing public.
A prior hearing is also not required whenever
the Commission finds it appropriate to issue a
CDO. To equally protect individuals and
corporations from baseless and improvident
8
directly at the head office, any of its field offices
or may deposit the payments in Primanila’s
Metrobank account. 3. [PRIMANILA] failed to
renew its Dealer’s License for 2008. 4. Among
the many planholders of [PRIMANILA] are
enlisted personnel of the PNP. Premium
collections for Primaplans via salary deductions
were religiously remitted to [Primanila] on a
monthly basis. 5. It failed to deposit the required
monthly contributions to the trust fund in violation
of Pre-need Rule 19.1. SEC declared that
Primanila committed a flagrant violation of
Republic Act No. 8799 particularly Section 16
thereof. It also breached the New Rules on the
Registration and Sale of Pre-Need Plans,
specifically Rule Nos. 3 and 15 thereof, to wit:
Rule 3. Registration of Pre-Need
Plans.—No corporation shall issue,
offer for sale, or sell Pre-Need Plans
unless such plans shall have been
registered under Rule 4.
Rule 15. Registration of Dealers,
General Agents and Salesmen of Pre-
Need Plans. 15.1. Any issuer selling
its own Pre-Need Plans shall be
deemed a dealer in securities and
shall be required to be registered as
such and comply with all the
provisions hereof;...
The SEC then issued the subject CDO “in order
to prevent further violations and in order to
protect the interest of its plan holders and the
public.” Feeling aggrieved, Primanila filed a
MR/Lift CDO arguing that it was denied due
process as the order was released without any
prior issuance by the SEC of a notice or formal
charge that could have allowed the company to
defend itself.
issuances, the authority of the SEC under this
rule is nonetheless with defined limits. A cease
and desist order may only be issued by the
Commission after proper investigation or
verification, and upon showing that the acts
sought to be restrained could result in injury or
fraud to the investing public. Without doubt,
these requisites were duly satisfied by the SEC
prior to its issuance of the subject cease and
desist order.
Records indicate the prior conduct of a proper
investigation on Primanila’s activities by the
Commission’s CED. Investigators of the CED
personally conducted an ocular inspection of
Primanila’s declared office, only to confirm
reports that it had closed even without the prior
approval of the SEC. Members of CED also
visited the company website of Primanila, and
discovered the company’s offer for sale thereon
of the pension plan product called Primasa
Plan, with instructions on how interested
applicants and planholders could pay their
premium payments for the plan. One of the
payment options was through bank deposit to
Primanila’s given Metrobank account which,
following an actual deposit made by the CED
was confirmed to be active.
Records with the SEC’s Non-Traditional
Securities and Instruments Department (NTD)
disclosed Primanila’s failure to renew its
dealer’s license for 2008, or to apply for a
secondary license as dealer or general agent
for pre-need pension plans for the same year.
SEC records also confirmed Primanila’s failure
to file a registration statement for Primasa
Plan, to fully remit premium collections from
planholders, and to declare truthfully its
premium collections from January to
September 2007.