The Securities and Exchange Commission has canceled the corporate registration of Silverlion Livestock Trading Corp. for soliciting investments from the public without the requisite license.
In an order dated Jan. 5, the SEC Enforcement and Investor Protection Department (EIPD) revoked the certificate of incorporation of Silverlion for violation of Republic Act 11232 or the Revised Corporation Code of the Philippines, in relation to RA 8799 or the Securities Regulation Code, and Presidential Decree 902-A.
Silverlion’s activities constituted serious misrepresentation as to what it can do, to the great prejudice of or damage to the public, a ground for the revocation of a corporation’s certificate of registration under PD 902-A, according to the order.
Silverlion also does not have the required secondary license from the SEC to offer or sell securities to the public, the department noted in the order.
Section 8 of the Securities Regulation Code (SRC) provides 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.
Meanwhile, Section 26.3 states it shall be 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.
Section 28 adds 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.
Investigations by the EIPD and SEC Zamboanga Extension Office revealed Silverlion had been offering and selling investment packages to the public with guaranteed returns of 35 percent within just 15 days. With this, investments ranging from P1,000 to P100,000 could yield returns worth P1,300 to P130,000, respectively.
Silverlion’s scheme involves securities, particularly an investment contract, whereby a person invests his money in a common enterprise and is led to expect profits primarily from the efforts of others, according to the EIPD.
As a form of security, investment contracts must be registered with the SEC before they can be sold or offered within the Philippines.
“The scheme being offered by Silverlion Livestock Trading Corp.…promising a return of 2.3 percent per day or 35 percent after 15 days has the characteristics of a Ponzi scheme. Such scheme is prohibited under Section 26 of the SRC,” the order read.
“The investment scheme of Silverlion also operates to defraud investors as it deceives the investing public by making it appear that they have the authority to deal in securities.”
The revocation of Silverlion’s corporation registration followed the successful implementation of a search warrant against Silverlion by the combined forces of SEC ZEO and NBI last year, where they seized bundles of cash, vouchers, and other devices allegedly used for the upcoming payout of profits to its existing investors.
The SEC subsequently filed a criminal case against Silverlion before the Department of Justice on Dec. 2, 2022, implicating its chief executive officer Ryan Ladoing, incorporator Renan Ladoing; its officers and agents identified as Rosemarie Guzman, Neña Algoy, John Paul Lopez, and Michael Berja.
Ryan and Renan Ladoing remain at large.
The SEC on Nov. 17, 2022 issued a cease and desist order against Silverlion, ordering the group to stop its investment solicitation activities. – Press release