The Philippine SEC has issued a securities fraud warning against Crowd1.
As per an investigation into Crowd1 by the SEC, the regulator found
it is apparent that the business of CROWD1, while undoubtedly a pyramiding scheme, is a securities offering through an investment contract.
Furthermore, the use of the product or the online gaming is a front to entice the public to invest and to hide the recruitment aspect of the modus operandi of the company.
This is in line with
BehindMLM’s Crowd1 review
, published last August.
The SEC notes the registering of a shell entity known as Crowd1 Asia Pacific Inc last October.
Since registering however, Crowd1 Asia Pacific has not registered a securities offering with the SEC.
Registration grants juridical personality to the corporation but does not authorize it to issue, sell or offer for sale securities to the public nor to undertake business activities requiring a secondary license from the Commission.
In light of Crowd1 operating illegally in the Philippines, the SEC warns
CROWD1 ASIA PACIFIC INC. is not authorized to solicit investments from the public, not having secured prior registration and/or license to sell securities or solicit investments.
Crowd1 has no corporate operations in the Philippines. Local promoters of the scheme however face fines of 5 million PHP (~$415,000 USD), or a twenty-one year prison sentence.
In view thereof, the public is hereby advised to exercise caution in dealing with any individual or group of persons soliciting investments for and on behalf of CROWD1 ASIA PACIFIC INC.
The public is further advised NOT TO INVEST or to STOP INVESTING in the investment scheme being offered by the subject entity or its representatives.
Crowd1 is not registered to offer securities in any jurisdiction. The company operates illegally the world over.
The Philippines fraud warning follows a similar warning issued by Paraguay last month. Namibia also banned Crowd1 back in February.
Norway reported they are investigating Crowd1 last November. Since then however there have been no further developments.
Crowd1 is owned by Jonas Erik Wener. The company is operated by CEO Johan Stael Von Holstein from Sweden.
To date Swedish authorities have taken no action against Crowd1.
Update 20th July 2020 –
As of July 20th Crowd1 has been
permanently banned in the Philippines
.
🤖 Quick Answer
What regulatory action has the Philippine SEC taken against Crowd1?The Philippine Securities and Exchange Commission issued a formal fraud warning against Crowd1, identifying it as an illegal pyramiding scheme disguised as a securities offering through an investment contract. The regulator determined that online gaming activities serve as a deceptive front to conceal the recruitment-based operational model underlying the company's business structure.
Why did the SEC classify Crowd1 as a securities offering?
The SEC determined that despite Crowd1's presentation as a gaming platform, its actual mechanism constitutes an investment contract meeting securities regulation criteria. The structure requires investments with returns dependent on recruiting new participants rather than legitimate operational activities or product sales to external parties.
What enforcement gap exists regarding Crowd1 Asia Pacific Inc?
Although Crowd1 Asia Pacific Inc registered as a shell entity in October, it failed to register any securities offering with the Philippine SEC subsequently. Registration alone grants
🔗 Related Articles
- Be Club securities fraud warning from Canada (OT)
- Quantex securities fraud warning from QC, Canada
- SageMaster securities fraud warning from Austria
- Second Family First Life robocall fraud lawsuit filed in Michigan
- BitradeX securities fraud warning from Thailand