I’ve been blogging for eight months now and I can tell you that on a good day, the visits I receive from the Philippines, according to my Feedburner stats, are no more than five (thanks to my wife... brother...:D). You can understand, therefore, my surprise over the many hits and page views that I have been favored with by Philippine visitors since I blogged about the PIPC scam last Sunday.
The hits are still coming, mostly from Google searches, as I was leaving the office this afternoon. There is an obvious thirst for information on this latest local financial scam. That could be why the visitor traffic is still up many days after the scandal broke out. As I review my Sunday post, however, even I am disappointed that my write-up begs more questions than it can answer. Thus, I decided to gather more details on the PIPC scam to update my earlier post on the subject.
Here are more tidbits about PIPC, the personalities involved, the victims, the scheme, and the investigation from various online sources, in rambling fashion (Please note that all of these are from secondary sources. I cannot guarantee, nor validate, the authenticity of the information presented here):
Performance Investments Products Corporation-
The nine-year old company is registered with the Securities and Exchange Commission (SEC) as a "research company", according to Senator Juan Ponce Enrile. The incorporators reportedly included Michael H.K.Liew, Cristina Gonzalez-Tuason, Tina Jurado and Ernest Sy.
ABS-CBNNews.com reported that PIPC only provided business solutions like IT support to Performance Investments BVI clients; it was this British Virgin Islands company, also owned by Mr. Liew, which allegedly took the investors’ money.
Michael H. K. Liew-
According to the Singapore Straits Time, "Mr. Liew was the principal donor to the renovation of part of the obstetrics and gynaecology wing of the Philippine General Hospital in Manila. He led the ribbon-cutting at the inauguration last August and was presented with a plaque for his philanthropy. The hospital's website said Mr Liew dedicated the project to the memory of members of his family who perished in Phuket, Thailand, in the December 2004 tsunami."
GMANews.TV had reported that he left the country on June 20 and that his $2 million account in a Hong Kong bank had been blocked by Hong Kong authorities when he attempted to transfer funds to another bank account, after they were alerted by Singaporean authorities about Mr. Liew's questionable trading activities.
Cristina Gonzalez-Tuazon-
Cristina Gonzalez-Tuason, the whistle-blowing general manager of PIPC, used to live in Wack Wack Subdivision, but she doesn’t live there any longer. She has reportedly moved to Dasmariñas Village in Makati for security reasons.
The Investment Scheme/Scam-
Mr. Liew’s investment scheme reportedly involved the trading of so-called "futures derivatives," which allowed an investor to trade on margin. This sort of trading magnifies an investor’s gains, but when the market moves against him, it also amplifies his losses.
The ManilaTimes.net likened the scheme to the operations of the defunct Manila International Futures Exchange, which was closed by the SEC in the mid-1990s after receiving numerous complaints from investors.
PIPC Investors
A counsel for at least five PIPC investors gave the estimate that around 2,000 to 3,000 people have been scammed by Mr. Liew, although more complainants are expected to come forward. The investors included expatriate executives and rich and influential families living in Forbes and Dasmariñas who are embarrassed to come out in the open.
According to ABS-CBNNews.com some of the investors have been clients of Performance Investments BVI since 8 to 10 years ago! Thus, most of them have actually earned enough to be able to offset partly, if not fully, their recent losses from the scam. These are likely to be the ones who will simply free-ride on any class suit to be initiated by other aggrieved parties.
Senate Investigation-
Senator Juan Ponce Enrile had filed a resolution at the Senate calling for an investigation, in aid of legislation, into the forex trading scam perpetrated by PIPC.
Public Assistance Center-
The National Bureau of investigation (NBI) has set up a public assistance center at the Azure function room on the 8th floor of The Pearl Manila Hotel, right across the NBI headquarters on Taft Avenue, Manila. The center will receive complainants round-the-clock, Monday to Friday. The contact numbers are: +63 2 4000088, local 3010 and 3011, and +63 927 4845883.
Make Own Payments?
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2 comments:
with your background and expertise in investment banking, it would help if you could explain how the PIPC group was able to fool its "investors".
for example, can a licensed broker or an investment rep ever guarantee principal and returns - especially on FX investment products? what are the repercussions to these individuals if such claims are made?
investors were asked to deposit the minimum investment amount into savings accounts they opened. where did the money go from there? can an outgong wire be traced to see where the funds went?
what are the liabilities of the "agents" of PIPC?
My lawyer-friend, who read this post and your comments, has advised me to politely sidestep your questions. First, because I don't have a shred of first hand information or documentation about the whole scheme, and there is no point in hazarding a speculative answer to hypothetical questions. Second, these were asked anonymously.
I believe he is right. But let me try to meet you halfway. For example, let's take your question
on "how the PIPC group was able to fool its 'investors'" (btw, why did you put quotation marks on the word investors? Were they or weren't they such?). I have no idea on the actual sales pitch that "fooled" the investors. Was it a PIPC officer, employee, agent, or consultant who did the pitching? Or was it a good friend or close relative who is an investor himself who convinced the poor victim? I don't know, and there could be a dozen (or more) variations for this modus operandi, for all we care.
Can a licensed broker or an investment rep guarantee principal and returns? What are the liabilities of the "agents"? Ah, that's where I'd rather that a lawyer answer those questions.
As for the other questions, kindly show me the actual documentation for the investment (if you have) so you can get an accurate answer. I won't go out on a limb on this. Remember, I'm not hiding behind an alias. I should be careful with my answers.
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