The Department of Justice (DOJ) has assigned a prosecutor to conduct the preliminary investigation of the criminal complaints filed by the Securities and Exchange Commission (SEC) against the owners and officers of Maria Francesca Tan (MFT) Group of Companies, Inc. and Foundry Ventures I, Inc. for engaging in alleged illegal investment activities.
“A prosecutor has been assigned to the case that was received by the DOJ last April 15,” Prosecutor General Benedicto A. Malcontento said on Monday, April 22.
Malcontento said the the prosecutor has yet to issue a subpoena to the parties that would require them to appear at the DOJ for the start of the hearings.
The SEC had said it had filed with the DOJ criminal charges against MFT and Foundry Ventures for violating Sections 8, 26, and 28 of Republic Act (RA) 8799 , the Securities Regulations Code (SRC), in relation to Section 6 of RA 10175, the Cybercrime Prevention Act of 2012.
It also accused MFT Group of Companies and Foundry Venture of violations of Section 54.1(c), in relation to Section 54.2 of the SRC, and Section 177 of RA 11232, the Revised Corporation Code (RCC), and SRC Rule 68, in connection with material misrepresentations in their audited financial statements.
It told the DOJ that the criminal charges stemmed from complaints submitted by several investors who participated in the investment scheme of the MFT Group which later transitioned to Foundry Ventures.
It also said that the MFT Group allegedly promised Guaranteed returns ranging from 12 percent to 18 percent of the amount they invested which was considered as interest income.
SEC said that the scheme was perpetuated through the issuance of post-dated checks reflecting a one percent to 1.5 percent monthly interest to interested investors who were given either a promissory note or borrower-lender agreement as proof of their investment.
Under Section 8 of the SRC, the SEC explained “securities shall not be sold or offered for sale or distribution within the Philippines, without a registration statement duly filed with and approved by the SEC.”
It also said that Section 26.3 of the SRC states that it is “unlawful for any person, directly or indirectly, in connection with the purchase or sale of any securities, to engage in any act, transaction, practice, or course of business which operates or would operate as a fraud or deceit upon any person.”
It pointed out that Section 28 of SRC provides that “no person shall engage in the business of buying or selling securities in the country as a broker or dealer, or act as a salesman or an associated person of any broker or dealer unless registered as such with the Commission.”
In its DOJ complaints, SEC said that the MFT Group of Companies and its officers and directors were also liable for 17 counts of misrepresentations in its 2018 to 2021 audited financial statements (AFS) by reflecting dividend income which has no basis.
Those named as respondents in the complaints are Maria Francesca Tan, Eduardo Tan, Florita Tan, Enrique Eduardo Tan, Charles Edward Tan, Christian Konstantin Agbayani, Maria dela Funete, Philip Tan, Jenna Fuentes, Ronaldo Nery, Halmond Parker R. Ong, Chiqui T. Tan, Jose Donnie B. Montelibano, Romarico S. Ruiz, Arlene M. Navarro, Maria Beatriz Dolores R. Tomas, Mary Ruth A. Oquendo, Joanne A. Cabaero, Thuy Nguyen, Roxanne G. Agbayani, Luis Gabriel R. Cancio Jr., Noel M. Olan, Joselito D. Hernandez Jr., Christian M. Olan, Tito T. Cosejo Jr. Christian De vera,. Jose Carlos R. Cancio, Mae Tan, Martin Choi, Reanne Po, Marta Gilda M. Poursabouri, Alan Madlangbayan, Mildred Madlangbayan, Jeruz Madlangbayan, and Rosanna Vidal.
It also charged Isla Lipana and Co. which served as independent auditor of the MFT Group and Foundry Ventures from 2018 to 2021.
Earlier, the SEC had made permanent the cease and desist order (CDO) it issued against MFT Group of Companies and Foundry Ventures I, Inc., along with their officers and agents.
It denied for lack of merit the firms' motion to lift the CDO.