The Securities and Exchange Commission has warned the public against investing in small gasoline stations that promise “hassle free” profit.

In an advisory, the SEC said there has been a proliferation of groups illegally soliciting investments for the purpose of setting up gasoline stations.

“The usual scheme of these small gasoline companies is to lure investors by advertising that they can co-own a gas station for a minimal amount of at least P300,000,” the SEC said.

Prospective investors are asked to co-invest in a gas station which will be franchised and owned by several co-franchisees.

“In the said offers, the construction, management and operation of the gas stations will be the responsibility of the company. The investors just have to place their money, sign the contract, then wait for the quarterly distribution of profits. Some would even offer a guaranteed profit by claiming that the loss will be shouldered by the company,” the SEC said.

“The Commission reminds the public that these kinds of contracts or investment schemes, no matter how they are called, squarely fall under the definition of an “investment contract ” and/or subscription of “shares of stocks”.

The SEC cited the Securities Regulation Code which states that any issuance of unregistered securities is illegal.

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