Jacob Cham vs. Kingly Commodities Traders & Multi Resources, Inc.

[SEC-SICD * CASE NO. 3073. July 9, 1992.] JACOB CHAM , complainant , vs . KINGLY COMMODITIES TRADERS & MULTI RESOURCES, INC. , respondent . D E C I S I O N This case involves a recovery of deposit and the claim for damages by reason of fraudulent acts. Complainant alleges seriatem that on June 11, 1986, complainant was enticed by respondent through its representative John R. Chua Uy to deposit and invest in future commodity trading; that complainant made an initial deposit of P20,000.00 through John R. Chua Uy for which he was given an account No. V3C-1002 and his investment consultant were John R. Chua Uy and a certain Mr. Bautista, one representing the respondent; that on June 26, 1986, complainant made another deposit of P40,000.00 allegedly to meet the minimum margin requirement per information of his consultant that respondent through its representative fraudulently represented to the complainant that his deposit shall surely raise high profit and shall be safe thus his certificate of deposit shall be given later; complainant was assured that he can withdraw his deposit anytime but which representations were violated by respondent. Respondent in perpetuating its fraudulent intentions, made complainant to sign many blank forms of supposed respondent's instruction of sales and purchase payment instruction and transfer notice which were fraudulently represented to him as mere forms needed for trading. The misrepresentations, mishandling of funds, unauthorized withdrawal of payments, and refusal to return deposit or to pay him his alleged profit were committed. Moreover, through fraudulent representation, complainant's initial deposit was increased with the use of pre-signed forms, which include account No. V3C-1003 in the name of his minor brother (Chester Siyambio) as suggested to him by respondent's representative John R. Chua-Uy. Respondent Corporation made material denials in its amended answer and alleged, that it was the complainant who volunteered to open an account with a partial margin deposit of P20,800.00; that his investment consultant was Mr. Rey Buenavista; that there was no representation made that his investments will surely earn high profit and will be safe; that when the complainant on his own initiative, visited the Vernida Sales Department of respondent, he sat down with the representative of the respondent to discuss the Customer's Agreement Risk Disclosure Statement, and his Acknowledgment Statement that he understood all the documents he signed; that after the documents were explained to him, the complainant signed the document and made his partial margin deposit; and that even before he traded in commodity futures through the facilities of the respondent, the complainant was already familiar with the mechanics and rules involved because he was already trading with the mother company and that he opened another account in the name of Chester Siyambio at his own initiative for the purpose. From the evidence adduced during the hearings the following indubitable facts are established: petitioner paid John Chua Uy initially the amount of P20,000.00 (TSN March 16, 1987, p. 22) as evidenced by a deposit notice dated June 11, 1986 (Exh. "A", Exh. "2") he made payment in the another amount of P40,000.00 evidenced by a deposit notice dated June 26, 1986 (Exh. "B", Exh. "3"). These payments were substantiated by the personal check of P20,000.00 and P40,000.00 respectively marked as Exh. "C" and Exh. "D". Petitioner again paid him an amount of P80,000.00 as evidenced by a margin receipt marked as Exh. "6". Margin receipts covering the amount of P66,970.00 as well as P57,000.00 paid to John Chua-Uy were evidenced by Exh. "H" and "I". Likewise another margin receipt covering P74,400.00 was issued to the petitioner, marked as Exh. "J". Although the first two payments were covered by personal checks, the rest were manager's checks (TSN Sept. 3, 1987). John Chua-Uy issued to the petitioner two account numbers. Account No. V3C-1002 (Exh. "K") and V3C-1003 under the name of Chester Siyambio. Mr. Carrol Tang admitted all the deposits which were reflected in the ledger of the two accounts and evidences by margin receipts Exhs. "I" and "J". (TSN Nov. 3, 1988, pp. 25-29). However, there were other deposits made by the complainant himself which were not testified on such as the deposit made on July 17 in the amount of P3,812.07 and another on August 20 for P30,000.00 the check for August 20, however, bounced (TSN Nov. 3, 1988 pp. 30-31). According to the complainant, he signed these documents such as instructions to purchase or an instruction of purchase marked as Exhs. "L", "L-1" up to Exh. V-2" and there were no entries appearing in these documents at that time. However, these documents were subsequently filled up without complainant's knowledge if these were true, complainant could have filed a complaint with the management in writing within three days upon receipt of the confirmation order regarding his instructions of purchase or sale but he did not. Moreover there is no irregularity in the transactions undertaken. The holding of two or more accounts in the name, of two different individuals for actually one person is not in violation of any existing rules on commodity futures. PREMISES CONSIDERED, this case is hereby DISMISSED for lack of merit. STECDc SO ORDERED. (SGD.) JOSEFINA L. PASAY-PAZ Hearing Officer