Financemanila has compiled some Common denominators and guidelines for scams:
- using lofty and popular names like sm fund (to associate themselves with sm), royal manchester five (to sound Britishly foreign, like the soccer team), francswiss (to associate itself with foreign exchange)
- promising you high returns easily over 1% per month without offering you full transparency as to where and how money is reinvested. Scams below 1% are rare, considering it is not worth it, and they must defraud a lot of people in a short time by offering attractively big interest rates.
- no SEC registration, or SEC registration is not for financial services or lending. Take note that with the 2002 case of Rose Baladjay's multitel, they were even legally registered at the SEC for lending to a maximum of 19 investors. So even having an SEC license for lending does not clear a company from being a scam, but having no license should automatically ring a bell!
- flashy lifestyle of organization acquired in such short a time to lure you in sense of urgency
- company must at least have a website, preferably hosted in-house and not rented in one of those webhosting packages. Though, having a website does not guarantee a company is not a scam. It merely establishes trackability.
- company must have at least an office front for customers to visit. Again, trackability.
- company must issue Official Receipt with valid TIN. So there's your clue. No SEC No BIR No OR. Again, trackability and paper trail.
- having politicians, clergymen, or kin endorse the so-called financial product does not guarantee its legality.
SEC warning last year:
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