MANILA -- The Securities and Exchange Commission (SEC) has stopped four companies, which are either owned, headed or associated with besieged Joseph Calata, from selling and offering for sale Krops Tokens and KropCoins.  

SEC issued a cease and desist order (CDO) against Black Cell Technology Inc., Black Sands Capital Inc., Black Cell Technology Limited and Krops, their partners, officers, directors, agents, representatives, conduits and assigns.

“The continued public offering and sale of the Krops Tokens and/or KropCoins without the required license from the Commission makes the public offering and selling a continuing illegal act which makes it imperative and necessary that a cease and desist order be immediately issued,” said the SEC.

Based on the circumstances, SEC said that the Krops Tokens and/or KropCoins are securities since these represent interests in a profit-making venture, evidenced by instruments in electronic form.

It said what is involved here is an initial coin offering (ICO), which is essentially the same as a public offering of securities.

A public offering of securities is subject to strict disclosure rules, which includes the disclosure of pending cases against the founder/offeror/promoter, which would put the investing public on guard.

The SEC said the Securities Regulation Code (SRC) provides that “securities should be registered with the Commission before being offered or sold to the public in order to protect the investing public from worthless securities, which, if unchecked, is likely to cause grave and irreparable damage and injury to the investors and the public in general.”

The securities regulator also warned that administrative and criminal actions will be instituted against persons or entities who act as solicitors, information providers, salesmen, agents, brokers, dealers in behalf of these companies.

Meanwhile, Calata is the same person who was permanently disqualified on Dec. 3, 2017 by the Philippine Stock Exchange (PSE) from being director or officer of any listed company.

Calata is the chairman, president and chief executive officer of Calata Corporation, which was delisted from PSE for securities law violations.

Also, SEC filed in 2017 with the Department of Justice a criminal complaint against Calata Corporation and its officers and directors for making false and misleading statement with respect to a material fact in violation of Section 24 of the SRC. (PNA)