THE Securities and Exchange Commission (SEC) has issued an advisory against C’PRENEUR Perfume Trading, which it said has been soliciting investments without the required registration or license.
In an advisory on Tuesday, the regulator said C’PRENEUR has been offering investment options through two “business models”: a Mobile Stockist Plan priced at P100,000 and a starter package costing P2,500.
C’PRENEUR, according to its website, is a supplier and distributor of beauty and health products based in Iloilo City, founded in 2020.
“Under the Mobile Stockist Plan, an investor is entitled to 40 personal accounts, plus 10 personal accounts, binary commission worth P14,000 to P17,000, and 20% rebate on every package sold. While for the starter package, each account is entitled to 3 bottles of perfume worth P3,000,” the SEC said.
The business model also includes recruitment incentives and a “7 ways to earn” scheme involving product discounts, direct referrals, binary bonuses, national and royalty bonuses, executive bonuses, and franchising.
Members reportedly received a Binary Bonus of P200 for every new member they recruited, while original members also earned the bonus whenever someone in their “downline” recruited a new member.
“Based on their website, a three-month projection of a starter package worth P2,500 can expect earnings up to P3.28 million,” the SEC noted.
The commission said these arrangements constitute an investment contract, which under the Securities Regulation Code (SRC) must be registered and authorized by the SEC.
The SEC defines an investment contract as a type of security that arises when funds are invested in a common enterprise with the expectation of profits mainly from the efforts of others.
Republic Act No. 11765, or the Financial Products and Services Consumer Protection Act (FCPA), also prohibits investment fraud. This covers deceptive solicitations such as Ponzi schemes and other arrangements that offer returns funded by investors’ own contributions, as well as the sale or offer of investment schemes without the necessary license.
The SEC said C’PRENEUR is not registered as a corporation or partnership and does not have a license to solicit investments.
It reminded the public that those involved in marketing or promoting these schemes may face criminal charges with penalties of up to P5 million in fines or up to 21 years’ imprisonment.
Those acting as salesmen, brokers, agents, promoters, recruiters, influencers, or enablers may be held liable under Section 28 of the SRC and Section 11 of the FCPA, with penalties under Section 73 of the SRC.
C’PRENEUR Perfume Trading has yet to respond to BusinessWorld’s requests for comment sent by e-mail and through its publicly available contact information. — Alexandria Grace C. Magno
