SEC Denies Motion to Lift the Cease and Desist Order against ALPHANETWORLD CORPORATION
The Securities and Exchange Commission (SEC) issued a Cease and Desist Order (CDO) on February 23, 2022 against ALPHANETWORLD CORPORATION doing business under the name and style of NWORLD. The CDO ordered NWORLD, officers, and agents to cease and desist from engaging in the unlawful/unauthorized solicitation, offer, and/or sale of securities in the form of investment contracts in violation of Section 8 of the Securities Regulation Code (SRC).
Contrary to the allegations of NWORLD, the SEC has found that its Silver, Gold, and Platinum Packages are securities in the form of investment contracts because they actually enabled investors who purchased packages to acquire an interest in the venture of the company in order to earn a profit. The company also employed commissions, bonuses, and other incentives to facilitate the sale of these Investment Packages.
Using US jurisprudence, the SEC ruled that an investment contract is considered to exist when a proponent offers an opportunity to the public to contribute money and share in the profits of the enterprise. Moreover, in the Philippine jurisdiction, a transaction or scheme where a person uses or intends to use money or property of others with a promise of profits is presumed by law to be an investment contract and must thus be registered with the SEC. Thus, the Commission denied to lift the CDO.
The full case can be found here.