SEC files criminal complaint against Seataoo
The Securities and Exchange Commission (SEC) has filed a criminal complaint against New Seataoo Corporation and Seataoo Information Technology, OPC (Seataoo OPC), as well as its officers, for soliciting investments from the public without the necessary license with the Commission.
In a complaint filed before the Department of Justice on January 16, the SEC charged New Seataoo, Seataoo OPC, and its officers and agents with violation of Section 8.1 of Republic Act (RA) No. 8799, or the Securities Regulation Code (SRC), in relation to Rules 3.1.17 of its 2015 Implementing Rules and Regulations, Sections 26.3 and 28 of the SRC, in relation to Section 6 of RA No. 10175, or the Cybercrime Prevention Act of 2012, Section 11 in relation to Section 3(f) of the Republic Act No. 11765, or the Financial Products and Services Consumer Protection Act (FCPA).
The SEC also implicated New Seataoo officers and agents namely Anna Rose Jangao Tero, Jonathan Tuazon Garcia, Danny Tuazon Sudaria, Lew Yean Yee, Seow Kai Sheng, Dylan Lim, and Seataoo OPC’s single stockholder, Jayson Corono Clidoro.
The SRC prohibits the selling or offering of securities to the public without the requisite registration statement duly filed with and approved by the SEC. It also requires the issuer to secure a permit to sell securities, and its agents to be registered with the Commission.
Meanwhile, the Cybercrime Prevention Act raises by one degree higher the penalty imposed for a crime committed through information and communication technologies.
Complaints were filed with the Commission by the public who were supposedly enticed to invest in the Seataoo Group based on advertisements found on social media platforms such as Facebook and Youtube. These investors claimed that they invested amounts ranging from P20,000 to P2.3 million, due to an expectation of returns from the group.
Upon investigation, the Seataoo Group was found to be offering securities in the form of investment contracts through its “dropshipping e-commerce platform” scheme.
Under the scheme, the Seataoo Group entices potential investors to become an online seller on its platform with the requirement that they deposit money in order to process orders. The investors are promised with a profit ranging from 7% to 12% of the amount they invested. It also offers an affiliate program where existing investors or online sellers get a 3% referral commission.
“This scheme affirms that the deposited funds are in reality, investments, since they are not limited to transactional payments directly tied to specific purchases. In fact, complainants demand for the return of their investments plus profits,” the complaint read.
“This mandatory funding of individual accounts required of Seataoo’s members/online sellers is a device used by Seataoo to mask its offer/sale of unregistered securities, and obtain investments from the public without having to secure the requisite license from the Commission,” it added.
The Seataoo Group’s public offering and selling of investment contracts without license likewise constitutes fraud or deceit upon any person, which is prohibited under Section 26.3 of the SRC.
Earlier, on June 10, 2024, the Commission issued an order of revocation against the New Seataoo Corporation and Seataoo Information Technology OPC revoking their certificates of registration for violations of Section 44 of RA No. 11232, or the Revised Corporation Code of the Philippines (RCCP), Sections 8.1, 26.1 and 28.1 of the SRC, Section 11 of the FCPA, P.D. 902-A in relation to Section 179(j) of the RCCP and Section 5.1 of the SRC.
In a decision dated December 26, 2024, the Commission En Banc denied the memorandum of appeal of the foregoing order of revocation filed by New Seataoo Corporation and Seataoo Information Technology for lack of merit. (PR)
