Topic: How a CEO of a Delisted Company TRIED to get Back by Selling Security Tokens (Read 273 times)

I cannot say na yung totoong motibo niya dito is to make KROPS his "pump and dump coin". Kasi if ginawa nya yun sa sarili niyang payment method for his KROPS na business siya din ay maa-apektuhan dahil bagsak presyo yung token nya. Pag linagay mo yung sarili mo sa point of view ni Joseph Calata na na-delist yung company sa stock market dito sa Pilipinas at sinubukan nya ng dalawang beses na magkaroon ng security token alam mo ang gust niya lang is makapasok sa public offering na market kasi sa totoo lang dito lang sya ulit magkakaroon ng capital after all the losses he incurred with the penalties and liquidations para sa kumpanya nya. IMHO he tried to create this ICO to act like his second "IPO" in the Philippines in the hopes na makakapag-raise sya ng funds para sa capital nya.


Proving my point na gusto niyang gawing "stock-like" yung token nya is yung statement na ito sa whitepaper ng KROPS which he said na "tokenized shares of the company" yung binibenta nyang KROPS coin. Yung presyo ng KROPS simply is tied directly sa performance ng kumpanya nya kaya hindi talaga possibleng maging pump and dump coin ito dahil sya din ay ma-aapektuhan pag ginawa nya ito.


Salamat, yan talaga yung buong punto ko sa pag-gawa ng thread na ito. Kasi as of right now na mga memorandum circular palang meron tayo sa bansa na nag a-act out na batas natin kailangan natin maging prepared sa mga ganitong klaseng pag-babago. Even with a proper law sa Philippines about sa cryptocurrency makikita mo naman na yung SEC natin meron ng understanding sa Security and Utility tokens since 2018 which is really a good sign for us dahil aware na sila sa mga different classifications na meron sa cryptocurrency. Bukod dun kahit wala pa tayong batas makikita mo na capable talaga yung SEC natin in handling cases involving cryptocurrencies, both BSP and SEC shows that they can be capable of being in charge pag dumating na yung crypto law natin.

Kropcoin became Crapcoin 

It probably is one of his schemes to convert all the remaining cash into cryptocurrency and if the ICO happens, dumping everything and getting all the invested money by the people. Buti na lang talaga hindi na natuloy. This goes to show that there are people who take advantage of cryptocurrency to evade their financial problems. Isipin mo yun, talagang ginagawang financial instrument yung cryptocurrencies. Maganda yun kung ginagamit sa tamang paraan, hindi sa pag bayad ng mga nawawalang value.

Mas naintindihan ko lalo ang importansya ng Security Token and Utility token, why it matters with the SEC.

I've read articles about his early years doing MLM and apparently he is proud about it dahil ginawa niya ito nung college pa sya, and alam mo kung saan sya nag-aral? Sa De La Salle University which is part of the Big 4 universities in the Philippines, wala syang hiya hiya na nag-promote ng MLM nya kahit mayayaman mga tao dun he treated this as an opportunity kasi alam nyang may pera yung mga nag-aaral dito, dun palang alam mo ng business-minded na tao sya. Yung pera na na-ipon nya dun dinagdag nya kapital dun sa business ng pamilya nila at yung lumaki dun na sya nag-tayo ng kanyang Calata Corporation. Kaya ang nakikita ko talaga dito sa bilis ng na-ipundar nyang pera dito na sya naging masyadong careless sa mga sumunod nyang galaw, he has really no one to blame but himself in his rise and fall.

No doubt that the dude is smart, kahit na unfortunately apparently nag MLM daw si Calata nung earlier years niya, which I'm definitely not a fan of. Sa dami rin ng media publicity ng nakuha niya dahil sa pagiging "young billionaire", tapos biglang nag downfall ung company niya, unfortunately pumunta nalang sa kalokohan-route para mabawi ung pera. Too much short term thinking from young people unfortunately. Mukhang di niya tanggap na somewhat mawawala ung super lavish lifestyle niya.

He was really desperate among all of the directors and board members ng Calata Corporation sa lang ang suspendido indefinitely, kahit gumawa pa sya ng bagong kumpanya basta parte ang pangalan niya duon hindi sya makakapasok sa stock market or hindi nya pwedeng gawing public yung kumpanya niya. Even if he tried to go crypto as a last resort kita naman natin kung gaano kabilis umaksyon yung SEC pagdating sa mga naging next moves niya ay walang nakalusot.


He was already named the youngest Filipino billionaire next to Injap Sia, ang pinaka mistake niya talaga dito is before naman maging public yung kumpanya malinaw na yung mga powers and limits ng isang CEO sa company, wala man tayong ebidensya na ginawa niya yung actions niya on purpose or unknowingly the point is he made mistakes that also lead to his shareholders losing money. Honestly maganda yung Agribusiness niya dahil nakatulong sya sa mga magsasaka natin makapagbenta directly sa supplier but yun lang nagkamali sya ng direksyon na tinahak, gawa na din siguro ng mabilisan nyang pag-angat.


I also think that he should also be behind bars, I will always remember his name since nakapag-attend na ako sa isa sa mga talks niya before all of this happened at masasabi ko na nakaka-impress kung paano nya ginawang billion peso business ang agriculture industry at nasabi ko sa sarili ko na isa sya sa mga businessman na gustong tumulong sa mga lower class na magsasaka. Pero I was wrong and got fooled sa mga matatamis nyang salita, ewan ko nga kung gusto niya talaga makatulong sa kanila o sadyang nabulag lang sya sa pera kaya naging ganito sya. I mean from agribusiness gusto nya mag-expand sa gaming industry? Yung attempt na yun dun ko nakita na wala talaga syang pake sa agribusiness nya at ginamit lang nya itong stepping stone dahil nakita nya yung potential nito para sa iba pang industriya.

This kind of people should have been in bars to be honest for fraudulent acts he really did. I remember this guy especially sa agriculture aspect since I've seen mostly his YouTube videos locally about farming especially sa rice farming at sa livestock. Seen also that one on YT about the downfall of it sa panonood ko ng mga videos about stocks and how this billionaire CEO deceived his investors.

If I was the investor sa Calata Corp. hindi rin ako papayag na ipagpalit yung shares trough CalCoins because mostly that will end up the same sa nangyari sa stock shares sa PSE.

Ah. I remember this dude.

Unfortunately, even though I don't want to take away ung pagiging risk taker at pagiging "madiskarte" nitong taong ito, as an actual CEO, he should have known kung gaano ka risky ung move na ginawa niya. Hindi lang risky para sa business niya, kung hindi risky rin para sakanya mismo.

Looking back in 2017, sa personal image palang niya na parang masyadong egoistic, sabi na nga bang may parang mali sa taong ito.

Joseph Calata was a brilliant entrepreneur, yes, but does not know the workarounds at mga pasikut-sikot sa stock markets, securities and most importantly sa cryptocurrencies. Naging last resort niya ang CalCoins to save his dying business dahil patok ang cryptocurrencies sa panahon ng delisting ng Calata Corp. sa stock market, however (at buti na lang) this did not age well. Hanggang sa nagtuloy-tuloy na lamang ang pagbulusok ng kanyang businesses at maraming utang lalo sa mga shareholders na up to now eh hindi pa rin daw nababayaran ng Calata Corp.

His case is a classic example of turning to cryptos as last resort to try and save something that has already sunk. Hindi lang siya ang huli na makikita lamang ang cryptos as a business model dahil marami-rami na ring mga scam programs ang lumaganap sa Pinas gamit ang front na cryptocurrencies, partikular yung NewG na iyon na hanggang ngayon eh malaya pa ring nakakagalaw ang mga perpetrators.

Maybe some of you have heard the name Joseph Calata (guy in the picture above) especially sa mga members dito na nag-iivest din sa Philippine Stock Market. Joseph Calata is or was the CEO of the now delisted Calata Corporation (agribusiness company) who attempted to get back in the game sa pamamaraan ng pagbenta ng "stock like" cryptocurrency aka Security Tokens. Itong kaso na ito ay ang pinaka unang kaso sa Pilipinas na involved ang unauthorized ICO offering sa bansa. What interest me in this case is it is similar to cases found in the United States na kung saan ay strikto pag-dating sa mga ICO offerings done locally involving Security Tokens, for your comparison ito yung pinaka recent na kaso ng US-SEC against Telegram which has also classified their token (GRAMs) as a security and not as a utility na unang classification nila. Hopefully na yung post na ito ay makakatulong sa pag-intindi ninyo kung ano nga ba talaga ang security tokens at bakit may mga SEC departments ay strikto sa kanilang mga offering.




Lahat ito nagsimula nung December 11, 2017 na delist (natanggal) sa Philippine Stock Market ang Calata Corporation (CAL) ni Joseph Calata, the involuntary delisting is due to the 29 violations na ginawa nya as the CEO and Chairman ng kumpanya. Kasama na dito kung paano niya minislead yung investors niya about them expanding in the gaming sector (casinos) sa upcoming Mactan Airport project noon, yung company disclosure na yun immediately boosted the speculative value of CAL from 2.97 ₱/share umakyat ng 4.28₱/share which is around 60% gain, the catch is yung disclosure na ito ay walang bahid ng katotohanan Joseph Calata released a disclosure based on a rumor na sya din ang gumawa. During this na-diskubre din ng SEC na habang tumataas yung stock Joseph Calata was actively trading his own shares of the company dahil na din sa price action na na-idulot ng false company disclosure nya in simple terms Calata committed insider trading using the fake information he have.

SEC with the involuntary delisting set in place also ordered Calata to buy back the shares of their disgruntled investors. However Calata directly said na yung retained earnings ng kumpanya ay hindi sapat para ibigay yung minimum na 1 Billion PHP na buy back offer para sa mga investors and up to this date Calata have rejected all orders from the SEC about the buy back offer for all investors, however this lead to the alternative of Calata offering a cryptocurrencies to its investors as replacement for their delisted stock shares.




3 months before being officially delisted Joseph Calata announced that Calata Corporations is going global dahil sa kanilang CalCoins offering citing in the announcement the current prices of Bitcoin and Ethereum going up in astronomical figures, sinusubukan niyang ipahiwatig na baka lumundag din presyon ng magiging ICO niya. Pag-tinignan mo yung 20:45 minute mark ng Youtube video makikita ninyo na sinabi ni Calata na "holding a token is equivalent of ownership of stocks" (take note ninyo it) dun palang mali na sya. This was a press conference designed to give solution para sa mga shareholders na magkakaroon ng worthless stock in just 3 months, Yung gusto lang ni Calata is mapapayag nya lahat ng investors to say yes para ma-distribute na nya yung CalCoins. Fortunately sa mga investors this plan died down dahil na din sa lack of interest ng mga shareholders sa proposal nya at sa paghintay nalang ng buy back/tender offer sakanila kaya hindi natuloy itong CalCoins na ito. Up to this day wala pa ding nagagawa si Joseph Calata para sa mga shares ng investors hindi nakapag-liquidate.




January 2018 about a month after CAL being delisted in the PSE bigla nalang nakatanggap ng mga reports ang SEC na si Joseph Calata ay may ino-offer na naman na bagong cryptocurrency named KROPS (KRO) gamit ang kumpanya na Black Cell Technology Inc., Upon further investigation of SEC napatunayan nilang may nangyari ngang unauthorized selling ng KROPS ICO dito sa Pilipinas. Pero bakit nga ba may Black Cell Technology na kumpanya dito at bakit sila yung nagbenta ng ICO ni Joseph Calata? Both Calata and Black Cell Technology ay nagbenta ng walang mga kailangan na lisensya o authorization sa gobyerno sa kanilang selling regardless if Utility o Security man ito.

Black Cell Technology Inc. : A Hong Kong Incorporated Company based in Bulacan, Philippines???


Base sa company profile na makikita sa whitepaper ng KROPS ang owner ng Black Cell Technology is none other than Joseph Calata. Honestly bukod sa Black Cell Technology meron ding mga tinayong Hong Kong incorporated companies si Calata namely Black Sands Capital at Black Cell Technology Ltd but since they all have similar boards at ang tanging si Black Cell Technology Inc. lang ang nagbenta ng ICO sa Pilipinas kaya for the sake of brevity tatawagin ko nalang silang lahat ng Black Cell Technology . Black Cell Technology according sa SEC cease and desist report nila ha no operations in Hong Kong but was just incorporated there, yung whole operations pa din nila is based sa Manila.


Proving my point is the fact na yung principal office address ng Black Cell Technology instead of a Hong Kong address ang linista nilang address is galing sa Pilipinas specfically sa Pulilan, Bulacan. Bukod dun lahat ng incorporators ng kumpanya ay walang nang-galing sa Hong Kong lahat ay nakatira sa Pilipinas. These incorporators namely Joseph Calata, Maricar Malaki, Halmond Ong, Jose Fabella, Solilapsi are also members of the board ng Calata Corporationm in short Black Cell Technology is Calata Corporation disguised as a Hong Kong based company. Kaya siguro nag-under the radar itong kumpanya na ito sa kanilang unang attempt sa pag-offer ng cryptocurrency sa Pilipinas kasi it was done locally at hindi internationally.


How did the SEC Identify KROPs Coin as Securities? - Howey Test


Bukod sa pag-papatunay na nag bypass nga ang KROPs at si Joseph Calata ng mga certain regulatory requirements para sa pag-conduct ng ICO dito from KYC, no license, at no authorization ang ICO ni Calata ay maitututing na Security Token base sa Securities Regulation Code (SRC) Section 3.1. Base sa depinisyon ng isang security makikita mo na ang KROPS ay isang "investment contract" na in-offer ng isang commercial company through electronic means. In simple terms pag ang isang kumpanya ay nag-offer ng isang cryptocurrency it will most likely be classified as a security token.


SEC to further prove the point that KROPS coins are securities ay gumamit sila ng test na ginagawa galing sa United States for identifying securities and investment contracts namely the Howey Test. I will only comment on 1 and 4 since ito yung heavily disputed ng dalawang partido namely Black Cell Technology and Enforcement and Investor Protection Department (SEC). Since 2 and 3 are accepted by Joseph Calata right away SEC only needs to prove the other two para ma-kumpleto yung Howey Test security classification para sa KROPS coin.

[1] Calata argued that "KROPS" ay pangalan lang ng mobile app nila at hindi ito kumpanya they also argued that KROPS cannot be considered as "Investment of Money" since ginagamit lang daw yung cryptocurrency nila as "medium of exchange". Dito nagkamali ng argumento si Calata kasi mabilis na kinontradict ng sariling Whitepaper ng KROPS yung statement niya. SEC specifically quoted their whitepaper stating that KROPS is not a mobile app pero isang "start-up company" pangalawa SEC also quoted that KROPS is on "ICO phase" quickly disproving the statement na ang token nila is a type of medium of exchange since wala pa naman makikita sa merkado na gumagamit ng KROPS as a payment method.

[4] Calata argued that yung pagtaas ng presyo ng cryptocurrency nila shouldn't be counted on their side stating na ang merkado daw ay volatile at yung nagdidikta ng presyo is yung demand sa market. Another invalid argument made by Calata, SEC responded by telling that since Black Cell Technology (juridical entity) is handling the efforts at yung expected profit ng kumpanya ay ipapamahagi sa KROPS holders ay nag-papakita na nakadepende nga yung value ng KROPS sa effot ng ibang tao/entity, SEC also emphasizes that there is also a profit distribution dun sa magiging earnings ng kumpanya.




Nanalo yung EIPD (SEC) sa kaso na ito dahil na satisfy nila yung four elements ng Howey Tests it resulted in a ban of the ICO being conducted in the country sa ngayon yung presyo ng KROPS ay 0$ at hindi na din active ang cryptocurrency na ito sa kahit anong crypto exchange. It had further damage the reputation of Joseph Calata again sa mga mata ng SEC at PSE for attempting to evade the ban na nakalagay sakanya sa stock market, it wasn't really a brilliant move kung iisipin kasi dalawang beses na syang nakapag-loko ng investors once sa stock company niya and dito naman sa KROPS at yung masakit dun ang pinaka-malalang penalty lang sa mga white-collar criminals na katulad niya is either ban, fines, o penalty lang walang pag-kakakulong. It was a good thing that the SEC acted out quickly na wala pang isang buwan na ban na yung ICO ng KROPS dito kasi kung hindi baka dumami pa ang maka-bili sa shitcoin niya.

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Kung natatandaan niyo naka-gawa ako ng post related sa ma-aaring maging batas natin sa cryptocurrency dito sa Pilipinas at buti nakita ko yung kaso na ito dahil dun sa previous post ko nag-speculate ako kung ano yung magiging classifications natin para sa cryptocurrency. Sa kaso na ito na confirm natin na recognized nga ng SEC ang Security Tokens at Utility Tokens. So dapat mag-expect na tayo sa mga upcoming ICOs done locally kung may proper licenses and documents sila on locally offering their ICO.