The Court of Appeals (CA) has upheld the Securities and Exchange Commission’s (SEC) cease and desist order against AlphanetWorld Corp. (NWorld) for illegally soliciting investments from the public.
In a statement on Tuesday, the SEC announced that the CA 8th Division ruled that the commission had provided due process in issuing the order in February 2022.
NWorld, along with its directors, stockholders, agents, and “all persons acting on their behalf,” was ordered to cease offering investments without prior approval from the SEC.
The appellate court stated in its Dec. 27, 2024 ruling that “undoubtedly, [NWorld’s] business operation or scheme constitutes an investment contract that is a security under [Republic Act] No. 8799,” also known as the Securities Regulation Code.
According to the SEC’s Enforcement and Investor Protection Department, NWorld marketed investment packages priced between P4,750 and P19,000, promising returns of up to P127,000 per month. Investors were also lured with bonuses such as discounted rates for purchasing packages, referral incentives, sales match bonuses, and potential earnings of P25,000 upon meeting recruitment targets.
The SEC argued that these offerings qualify as investment contracts, a type of security that must be registered and approved by the agency.
“The strict regulation of securities is founded on the premise that the capital markets depend on the investing public’s level of confidence in the system,” the CA emphasized.
The ruling reinforces the SEC’s authority to enforce compliance and protect the public from unauthorized investment schemes.
