The Philippines Securities and Exchange Commission (SEC) has directed Forsage and Forsage Philippines’ prompt closure, which has been revealed as a scam in recent months.
Forsage promotes itself to be a next-generation crowdfunding platform, assuring its investors zero risks, which it says is guaranteed by making smart contracts. It pretends to give investors with active and passive earnings through a crowdfunding referral scheme. The minimum investment is 0.05 ETH ($17), with the maximum investment capped at 51.2 ETH ($17,755).
The authority ordered the company to cease soliciting investments in the 7,000 plus islands of the Philippines. It also ordered the company to stop its Internet presence.
The watchdog said in serving the notice,
“The SEC further ordered Forsage to refrain from transacting any business involving funds in its depository banks, and from transferring, disposing, or conveying in any manner all related assets to ensure the preservation of the assets of the investors.“
This isn’t the first time the Philippines securities regulator has cautioned against Forsage. In July, it issued a warning against Forsage and other online scams that were targeting the Philippines. In its notice, it stated that Forsage “resembles a Ponzi scheme where investors are paid using the contribution of other investors.”
However, as the regulator noted on the new order, Forsage continued to operate even after the warning. In the month following the SEC warning, Forsage had a daily turnover of over $3 million, as claimed by dappstat.com. Moreover, the firm underplayed the SEC’s notice, insisting that it was not under the Commission’s jurisdiction since it was decentralized.
While declaring the cease and desist order, the regulator claimed that Forsage has been operating as a broker-dealer of securities without being registered with the Commission. Forsage is also not eligible to operate as a crowdfunding entity as it’s not duly regulated under Philippine laws. The firm is not registered as a virtual currency service provider with the Bangko Sentral ng Pilipinas (BSP).
The SEC warned the public against investing in any plot offered by Forsage and any other similar entity touting investment possibilities in digital currencies.
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