MUNICS NATION, INC., and MUNICS BANK (MUNICS), operated by MANXING CLOUD GROUP, is engaged in investment-taking activities not authorized by the Commission.
Date Posted: 17 March 2020
Based on the information gathered by the Commission,the entities operating under the names, MUNICS NATION, INC., and MUNICS NATION (MUNICS),operated by MANXING CLOUD GROUP,isengaged in investment-taking activities not authorized by the Commission.Primarily, MUNICS is operatinginMalaysia viaMonspace, but, findings also show that its investment offerings extend throughoutAsia including the Philippineswith the use of social media websites.As posted online, MUNICS NATION provides a number of investment packageswith corresponding high returns, taggedas deposit plans.Theseincludes the Gold, Platinum, and Global plans.To illustrate:Based on the forgoing, investors are offered Five toTen Percent (5-10%) interest per month or a total of Sixty to One Hundred Twenty Percent (60-120%) interest annually depending on the chosen package.Referral and ranking bonuses including dividends are also given as active bonuses to its investors.
MUNICS NATION claims that its investment packages are safe since MUNICS NATION is dealing with a stable cryptocurrency which can be traded flexibly to any fiat money or other cryptocurrencies. MUNICS NATION likewise states that the investment pool solicitedfrom the public shall be used asfunds intheir alleged cryptocurrencyand Blockchain Technologyventures.Thus, profits distributed to investors seem to result from the development of MUNICS NATION business enterprise with theuse of their monies.Accordingly,the schemeofMUNICS involves the offering and sale of securities, in the form of investment contracts, to the publicbecausetheirinvestors need not exert any effort other than to invest or place money in the said company in order to earn so that the latter may use itas trading capitalor to pay profits or returns to earlier investors.Briefly, an “investment contract”exists when there is an investment or placement of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others.Hence, Section 8 of the Securities Regulation Code (SRC)requires that all offers and sales of securities, including those involving digital assets, must be duly registered with the Commission and that the concerned corporation and/or its agents have appropriate registration and/or license to sell such securities to the public.Per record of the Commission, MUNICSor its operator, MANXING CLOUD GROUPareNOT REGISTEREDas a corporationor partnership. Likewise, these entities are NOT AUTHORIZEDto solicit, accept or take investments/placements from the public nor to issue investment contracts and other forms of securities defined under Section 3 of the Securities Regulation Code (SRC)because they donot have a secondary license from the Commission to solicit investments or other securities from the public for whatever purpose as provided under Sections 8 and 28 of the SRC.Also,MUNICSand the MANXING CLOUD GROUPDO NOT APPEARamong the registered banks, exchanges or companies engaged indigital assets with the Bangko Sentral ng Pilipinas (BSP) in accordance with theGUIDELINES FOR VIRTUAL CURRENCY EXCHANGES (BSP CIRCULAR NO. 944)which requires all entities engaged in Virtual Currencies in the Philippinesto obtain a Certificate of Registration to operate as remittance and transfer company pursuant to the BSP rules and regulations.Further Investigation also suggests that theirnamesare NOT INCLUDEDamong the approved,listed,and/or reporting institutionsdealing with digital currencies declared with the Bank Negara Malaysia (BNM).It must be emphasizedthat any unauthorized dealings involving digital assetslacks consumer protection because these arenot covered by prudential and market conduct requirements applicable to licensed and authorized activities.
Nevertheless, the Commission is constantly monitoring and overseeing cryptocurrency and other digital asset transactions in a way that it sees as appropriate in order to ensure the stability of the country’s financial sector.The public is advised to exercise extreme cautionin dealing with any individuals or group of persons acting or soliciting investments for and on behalf of MUNICSor any entities engaged in similar digital banking, exchange, and investment solicitation activities. The public must be wary that such dealings may be Ponzi schemesguised as investment contracts that promises ridiculous ratesof return with little or no risk.Consequently, those who act as salesmen, brokers, dealers or agents of MUNICSin selling or convincing people to invest in the investment scheme being offered by these entities including solicitations and recruitment through the internet may likewise be prosecuted and held criminally liable under Section 28 of the SRC and penalized with a maximum fine of Five Million pesos(P5,000,000.00) or penalty of Twenty-one (21) years of imprisonment or both pursuant to Section 73 of the SRC. Also, those who invite or recruit others to join or invest in suchventure or offer investment contracts or securities to the public may incurcriminally liability, or otherwise be sanctioned or penalized accordingly as held by the Supreme Court inthe case of Securities and Exchange Commissionvs. Oudine Santos(G.R. No. 195542, 19 March2014).The names of all those involved will also be reported to the Bureau of Internal Revenue (BIR) so that the appropriate penalties and/or taxes be correspondingly assessed.Should you have any information regarding any investmentsolicitation activity by any individualor group of individuals representing MUNICS, please call the Enforcement and Investor Protection Department (EIPD) at telephone number (02) 8818-6047 or send your report to the EIPD at email@example.com.For the guidance of the public. Pasay City, 10March 2020