The Court of Appeals (CA) granted a petition of the Anti-Money Laundering Council (AMLC) to freeze the bank accounts, securities and insurance accounts of Francesca Tan (MFT) Group of Companies Inc.
The appellate court, in a resolution promulgated on May 13, 2024, ordered the freezing of the bank, investment and insurance accounts of the MFT Group after finding probable cause that the group’s assets were related to an unlawful activity.
The freeze order covers 138 bank accounts, four securities accounts and four insurance accounts bearing the names of the MFT Group, Foundry Ventures I Inc., Mondial Medical Technologies, Maria Francesca Tan, Christian Konstantin, Roxanne Agbayani, Enrique Eduardo Tan, Charles Edward Tan and Luis Gabriel Cancio Jr., among other officials, across several banking and financial institutions.
Under Section 10 of Republic Act No. 9160, or the Anti-Money Laundering Act (AMLA) of 2001, as amended, the CA may issue a freeze order upon a verified ex parte petition by the AMLC and after determination that probable cause exists that any monetary instrument or property is in any way related to an unlawful activity.
Fraudulent practices and other violations under Republic Act No. 8799, or The Securities Regulation Code (SRC) are among the “predicate offenses” of money laundering, as provided under the 2018 Implementing Rules and Regulations of the AMLA.
“We find that there exists probable cause that the subject bank, securities, and insurance accounts may be related to violations of Section 8.1, Sections 26.1, 26.3, and Section 28.1 of the SRC, listed as an unlawful activity under Section 3(I)(33) of the AMLA, as amended,” the CA decision read.
The CA, in a separate resolution promulgated on May 17, also authorized the AMLC to inquire into or examine the bank, securities and insurance accounts of the group within a period of 120 days.
“Indeed, there is probable cause that the subject bank, securities, and insurance accounts stated herein may be related to violations of Section 8.1, Sections 26.1 and 26.3, and Section 28.1 of the Securities Regulation Code, listed as an unlawful activity under Section 3(i)(33) of the AMLA, as amended,” the CA ruled.
The freeze and bank inquiry orders were issued after the MFT Group was found to be soliciting investments from the public without the necessary licenses from the Securities and Exchange Commission (SEC), according to the corporate regulator.
Based on SEC’s investigation, the MFT Group promised guaranteed returns ranging from 12 percent to 18 percent of the amount they invested, which was considered as interest income.
Section 8 of the SRC provides that securities should not be sold or offered for sale or distribution within the Philippines, without a registration statement duly filed with and approved by the SEC.
Prior to the issuance of the freeze and bank inquiry orders, the SEC filed a criminal complaint against MFT Group and Foundry Ventures for alleged unauthorized investment scheme, as well as misrepresentations in the groups’ financial statements.
