Philippines SEC Warns Against ‘Decentralized’ Multi-Level Marketing Scheme, Forsage
The security and exchange commission of the Philippines has released a fresh warning against Forsage gifting schemes and has outed one Lado Okhotnikov as the mastermind behind the Forsage gifting schemes being operated in the country. The warning, which was released on June 30, warns citizens that the entity operating under the name of Forsage does not have the due clearance or authority to offer any such products to the Philippines natives.
The Philippines SEC released a security warning as Forsage was identified as a crowdfunding platform working on top of the ethereum blockchain.
What are Forsage gifting schemes?
Forsage is a gifting scheme operated through smart contracts. However, it is still prohibited in many countries because of the referral scheme, which imitates the working of a pyramid scheme. A user can earn Forsage rewards by merely referring the program to three other people.
The SEC warned consumers not to invest in any scheme or entity as it is not registered with the authorities or have any necessary license to accept investment from people, issue any form of investment contract or offer any other kind of security. The government prohibits any such unregistered security offering under Section 3 of the Securities Regulation Code (SRC).
The warning also notes that Forsage’s operations and schemes on offer suggest it is a Ponzi scheme as it utilizes the fee collected from new members to compensate existing consumers and so on. The working process of the program closely follows the standard pyramid scheme, where the people at the top makes the most of the profit, while people connecting at the bottom do all the tolling.
The SEC has singled out several such Ponzi schemes, including Facebook groups Fosage Philippines Forsage Smart Contracts along with a Youtube channel Christopher Doroliat, Forsage PH, and Think Wise Channel.perating under the garb of being decentralized. The SEC also cleared that running such schemes in the Philippines would attract stringent criminal persecution.