SEC Facebook

Based on information gathered by the Commission,
the
en
tity
operating under
the name
PANCAKE KING TOKEN
by JOHN PE BENITO and KATH BUENDIA is
soliciting investments in the Philippines
WITHOUT THE NECESSARY LICENSE
AND/OR AUTHORITY
from the Commission
.
PANCAKE KING TOKEN
claims that it
is an experimental and the
first
decentralized Philippine
–
based
community hybrid meme token
that is instituted on the
Binance Smart Chain.
Supposedly, for a minimum investment of Php500.00 and for a fee,
PANCAKE
KING TOKEN
promises
limitless earning potential just by
HODL
ing
or “
Holding on for
dear life
” of its
token
which seems to be “
to good to be true
”
and is an indication of a
possible
Ponzi Scheme
where returns to early investors are likely to be paid out from
the investments of new investors and not out of the compan
y
s’ profits
similar to those
already flag
ged by the Commission as
scams
.
In fact, as specified by
PANCAKE KING TOKEN
, the 7% fee it imposes for
each transaction or purchase of its token shall be allocated accordingly to its liquidity
pool and marketing and development including charity purposes while the rest shall
be reflected back to the HODLers or Holders as income.
Basically,
PANCAKE KING TOKEN
gathers money from the public to fund its
supposed project through
Initial Coin Offering
(
ICO
) on the promise of profits.
The
SEC
Advisory on
Initial Coin Offerings
and
Virtual Currency
posted
08
January 2018
provides that an
ICO
is the first sale and issuance of a new virtual
currency to the public usually for the purpose of raising capital for start
–
up companies
or funding independent projects.
Depending on the facts and circumstances surrounding their issu
ance, some
of these new virtual currencies follow the nature of a security as defined by Section
3.1 of the Securities Regulation Code (
SRC
)
similar to what
is being offered by
PANCAKE KING TOKEN
whereby a person invests money in a common enterprise and
is
led to expect profits primarily from the efforts of others.
Since what is being offered by
PANCAKE KING TOKEN
are securities,
Section
8 of the SRC requires that all offers and sales of said securities must be duly registered
with the Commission
and that
PANCAKE KING TOKEN
and/or its agents
must
have
appropriate registration and/or license to
offer and/or
sell such securities to the public
.
However, based on our records,
PANCAKE KING TOKEN
is
NOT
REGISTERED
with the Commission
and is
NOT
AUTHORIZED
to 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
SRC
in the Philippines
.
Our database also shows that
PANCAKE KING TOKEN
has no
brokers,
accoun
t managers,
agents,
and/or representative that
have appropriate registration
and/or license to
offer or
sell
such
securities to the public
.
PANCAKE KING TOKEN
is
NEITHER
REGISTERED
a
s a Virtual Asset
Service Provider (VASP)
with the Bangko Sentral ng
Pilipinas (BSP)
and
DOES NOT
HAVE A CORRESPONDING CERTIFICATE OF AUTHORITY
as a Money Service
Business
(MSB)
required under the Guidelines for Virtual Asset Service Providers
(BSP Circular No. 1108, Series of 2021)
.
Likewise, it
s
name
DOES NOT APPEAR
among those
list
ed as
registered
Money Service Business (
MSBs
)
as of January 2021 with the Anti
–
Money Laundering
Council
under the Anti
–
Money Laundering Act
.
Further, we noticed that
PANCAKE KING TOKEN
has yet to provide the
necessary
White P
aper
for its
purported token despite being already offered for sale
publicly which makes it appear more dubious.
Essentially, the so
–
called
White
P
aper
is the foundation or the basis of every
legitimate cryptocurrency projects that
contains its
fundamental purpose,
vision,
mission and story or creation timeline
.
Hence, it must be emphasized that such offering and sale of
securities in the
form of investment contracts using the
“
Ponzi Scheme
”
is fraudulent and
unsustainable and
is
NOT a registrable security
.
The
Commission will NOT ISSUE
a License to Sell Securities to the Public
to persons or entities that are engaged
in this business or scheme
.
The public is reminded that
unregistered and/or unauthorized platforms like the
PANCAKE KING TOKEN
’s
are risky as well and should be avoided accordingly.
Therefore, the
public is advised
NOT TO INVEST
or
STOP INVESTING
on
PANCAKE KING TOKEN
and/or in any other scheme being offered
by
it
no matter
how
enticing, trendy, or catchy its
slogan, proposition, and/or scheme
.
T
he Commission warns all unscrupulous individuals and/or entities that
strict
penalties are imposed for v
iolations of the
Securities Regulation Code, the
Revised Corporation Code, and such other rules and regu
lation e
nforced by the
SEC.
Those who act as salesmen, brokers, dealers or agents of unauthorized entities
in selling or convincing people to invest in their investment scheme offered including
solicitations and recruitment through the internet
, may likewise be criminally
prosecuted and penalized with a
maximum fine of Five Million pesos
(P5,000,000.00) or a penalty of Twenty
–
one (21) years of imprisonment or both
pursuant to Sections 28 and 73 of the SRC.
Similarly, those who invite or recrui
t others to join or invest in such venture or
offer investment contracts or securities to the public may incur criminally liability, or
otherwise be sanctioned or penalized accordingly as held by the Supreme Court in the
case of
SEC vs. Oudine Santos
(G.R.
No. 195542, 19 March 2014).
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 assessed
correspondingly.
Should you have any information regarding any
investment solicitation activity
by any individual or group of individuals representing
PANCAKE KING TOKEN
,
please send your report to the EIPD at
epd@sec.gov.ph
.
For the guidance of the public.
Pasay City, 12
Octob
er 2021