State-owned corporate regulator Securities and Exchange Commission (SEC) has issued a warning to the public about fraudulent investment schemes the SEC says are being undertaken by firm Forward Direct Selling Corp.
In an advisory, SEC said Forward Direct Selling Corp. is “inviting people to invest under the same scheme used by One Lightning Corp.,” which earlier was issued a cease-and-desist order from the commission.
“It has come to the attention of the commission that Forward Direct Selling Corp. is being operated by the same people behind One Lightning Corp,” SEC said, adding, “Using a different technology to make it appear that it is engaged in multilevel marketing, Forward Direct Selling Corp. is practically operating the same marketing program as One Lightning.”
SEC said that despite the change in corporate name, Forward Direct Selling’s marketing program is also attracting people to invest with the lure of profits derived from recruiting new investors into the program —a practice long recognized as a pyramid scheme.
Profits under this scheme come from the “amounts invested by downline investors, or so called dealers or distributors, who are themselves enticed by lure of profits” and will then recruit members under them, perpetuating a cycle that benefits only the investor or operator on top of the pyramid.
SEC is warning the public that people who opt to invest or engage in a venture with Forward Direct Selling “may be held criminally liable or accordingly sanctioned or penalized” based on criminal and corporate laws.
“In view thereof, the public is advised to stop investing in this kind of investment activity and to take necessary precautious in dealing with the above named entity or its representatives,” the corporate regulator said.
Besides Forward Direct Selling, SEC has been active in tracking down fraudulent investment and trading activities, investigating unregistered firms such as One Lightning Corp., One Dream Global Marketing Inc., and Global Intergold (formerly Emgoldex Philippines), among others.