DOJ finds probable cause to indict Kapa execs

In a press statement, the DOJ said it also indicted Marisol M. Diaz, Adelfa Fernandico, Moises Mopia and Reniones Catubigan for promoting and participating in the unlawful public offering and/or selling of securities by Kapa. (File Photo By Ramon FVelasquez – Own work, CC BY-SA 3.0)

MANILA–The Department of Justice (DOJ) has recommended the filing of criminal cases before the courts after finding probable cause against pseudo-religious investment firm Kapa-Community Ministry International (Kapa) officials for defrauding the investing public.

In a resolution issued on September 25, 2019, state prosecutors found probable cause to charge Kapa, its founder and president Joel A. Apolinario, trustee Margie A. Danao and corporate secretary Reyna L. Apolinario for violations of Sections 8 (8.1), 26.1, and 28 of Republic Act No. 8799, or the Securities Regulation Code (SRC).

In a press statement, the DOJ said it also indicted Marisol M. Diaz, Adelfa Fernandico, Moises Mopia and Reniones Catubigan for promoting and participating in the unlawful public offering and/or selling of securities by Kapa.

The SEC filed a complaint against Kapa before the DOJ on June 18, 2019, after uncovering the group’s unauthorized investment-taking activities.

Kapa has enticed the public to invest at least PHP10,000 in exchange for a 30 percent monthly “blessing” or “love gift” for life, without having to do anything other than invest and wait for the payout.

The scheme involved the sale and offering for sale or distribution to the public of securities, in the form of investment contracts.

The SEC also found Kapa to have employed a Ponzi scheme, an investment program that offers impossibly high returns and pays investors using the money contributed by other investors.

This qualifies as a fraudulent transaction prohibited under Section 26 of the SRC and initially issued an advisory against Kapa in March 2017. It would later issue a cease and desist order on February 14, 2019, and an order of revocation of the Kapa’s certificate of incorporation on April 3, 2019.

In the interest of affected investors, the Commission, through the Anti-Money Laundering Council, also obtained a freeze order from the Court of Appeals on June 4, 2019, to preserve assets linked to Kapa.