BCPay Financial Technology, Inc.

January 4, 2022 ENFORCEMENT AND INVESTOR PROTECTION DEPARTMENT SEC ADVISORY Based on reports and information gathered by the Commission, the people behind BCPAY FINANCIAL TECHNOLOGY, INC. (BCPAY, INC.) , namely, FREDOLINE "FRED" BRUNO and VICTOR "TROY" DENIA, together with MARCO MENDOZA, ARVANN CARIAGA, JOHNRU CADAG, MARK MARI, and CLYDE SANTOS are now doing business under the name OUTRACE "Play to Earn" and are again soliciting investments in the Philippines WITHOUT THE NECESSARY LICENSE AND/OR AUTHORITY from the Commission. Apparently, OUTRACE promises desirous earnings for its players and OUTRACE $ORE ($ORE) token holders alike by acquiring its in-game Non Fungible Tokens or NFTs on presale and purchasing $ORE beforehand through Initial Coin Offering (ICO) at a significantly low price on the pretext that both will considerably increase in value once the $ORE is listed on public exchanges. For better appreciation, below is the $ORE 's purported Tokenomics as bolstered by OUTRACE which deems to be " too good to be true ." Recurrently, we would again emphasize that as mentioned in our SEC Advisory on Initial Coin Offerings and Virtual Currency posted 08 January 2018 , an ICO is the first sale and issuance of a new virtual currency to the public usually for the purpose of raising capital for start-up companies or funding independent projects. The US SEC in its investigative report in "The DAO" case said that "securities law may apply to various activities, including distributed ledger technology, depending on particular facts and circumstances, without regard to the form of the organization or technology used to effectuate a particular offer or sale." Hence, depending on the facts and circumstances surrounding their issuance, some of these new virtual currencies follow the nature of a security as defined by Section 3.1 of the Securities Regulation Code (SRC) whereby a person invests money in a common enterprise and is led to expect profits primarily from the efforts of others. Fitly, this is in the same vein with the $ORE by OUTRACE whilst utilizing the NFT platform as part of its scheme in order to gather funds from the public to support its dubious project on the promise of lucrative return. Ostensibly, OUTRACE is capitalizing on the current popularity and pliancy or flexibility of the NFT application which is now being devised by many as an investment platform as well akin to those conventional mediums of pooling capitals by allowing users to buy, sell, and hold an array of funds or investments therefrom in the guise of in-game characters, boosters, commodities, and various digital assets and currencies. In this light, since what is being offered by OUTRACE are securities notwithstanding its outwardly shady attribute, Section 8 of the SRC requires that all offers and sales of securities as such must be duly registered with the Commission and that the concerned entity and/or its agents must have the appropriate registration and/or license to offer and/or sell such securities to the public. However, based on our records, OUTRACE is NOT REGISTERED with the Commission and is NOT AUTHORIZED to solicit, accept or take investments/placements from the public nor to issue investment contracts and other forms of securities defined under Section 3 of the SRC in the Philippines . Our records also show that OUTRACE does not have any brokers, account managers, agents, and/or representative that have appropriate registration and/or license to offer and/or sell such securities to the public . OUTRACE is NEITHER REGISTERED as a Virtual Asset Service Provider (VASP) with the Bangko Sentral ng Pilipinas (BSP) NOR DOES HAVE A CORRESPONDING CERTIFICATE OF AUTHORITY as a Money Service Business (MSB) required under the Guidelines for Virtual Asset Service Providers (BSP Circular No. 1108, Series of 2021) . Likewise, its name DOES NOT APPEAR among those listed as registered MSBs as of January 2021 with the Anti-Money Laundering Council under the Anti-Money Laundering Act, as amended . Considering the above, the public is advised NOT TO INVEST or STOP INVESTING in $ORE and OUTRACE and in all other endeavors or schemes associated with BCPAY, INC. which is supposedly at work behind herein despite the earlier SEC Advisory issued against it for engaging in similar unauthorized deed. The same goes for all entities providing and/or hosting NFT applications that are similarly offering non-registered and/or illegal investment opportunities within and without the country. Repeatedly, the public is cautioned that any offer or promise of ridiculous rates of return with little or no risk similar to what OUTRACE is offering is an indication of a possible Ponzi Scheme where returns to early investors are likely to be paid out from the investments of new investors and not out of the companies' profits similar to those already flagged by the Commission as scams . Those engaged in such operation tend to close or to shut down operations once they cannot gather enough investments from new investors to fund their schemes. The Commission is eagerly reminding the public that the offering and sale of securities in the form of investment contracts using the "Ponzi Scheme" is fraudulent and unsustainable and is NOT A REGISTRABLE SECURITY . The Commission will NOT ISSUE a License to Sell Securities to the Public to persons or entities that are engaged in this business or scheme . Thus, everyone is warned that strict penalties are imposed for violations of the Securities Regulation Code, the Revised Corporation Code, and such other rules and regulations enforced by the SEC. Those who act as salesmen, brokers, dealers or agents of unauthorized entities in selling or convincing people to invest in their investment scheme offered including solicitations and recruitment through the internet , may likewise be criminally prosecuted and penalized with a maximum fine of Five Million pesos (P5,000,000.00) or a penalty of Twenty-one (21) years of imprisonment or both pursuant to Sections 28 and 73 of the SRC. Equally, those who invite or recruit others to join or invest in such venture or offer investment contracts or securities to the public may incur criminal liability, or otherwise be sanctioned or penalized accordingly as held by the Supreme Court in the case of SEC vs. Oudine Santos (G.R. No. 195542, 19 March 2014). The names of all those involved will be reported to the Bureau of Internal Revenue (BIR) as well so that the appropriate penalties and/or taxes be assessed correspondingly. Should you have any information regarding any investment solicitation activity by any individual or group of individuals representing OUTRACE or those that are linked with BCPAY, INC. , please send your report to the EIPD at [emailprotected] . For the guidance of the public. Pasay City, January 4, 2022.