SEC warns public against investing in The Tipsy Tavern for lack of license

The Securities and Exchange Commission (SEC) on Tuesday warned the public against dealing with The Tipsy Tavern over its alleged illegal solicitation of investments without the necessary license from the commission.

It said in an advisory the company, with office in Malabon City, was actively enticing the public to invest in its bar/events place business.

The company is reportedly offering investors a monthly passive income of P25,000 to P50,000 for a minimum amount of P500,000. An investor will also be entitled to a 10-percent discount when visiting their bar, 15-percent discount for renting their event’s place and a 2.5-percent commission for each successful referral made.

The SEC said the scheme employed by the company has the characteristics of a “Ponzi Scheme” where money from new investors are used in paying “fake profits” to prior investors and is designed mainly to favor its top recruiters and prior risk takers.  It said it is detrimental to subsequent members in case of scarcity of new investors.

This kind scheme, the SEC said, is not only fraudulent and unsustainable, but is also not a registrable security.

The SEC said The Tipsy Tavern was also not registered with the commission and had not secured secondary license to enable it to sell investment contracts or securities to the public.

“In view thereof, the public is hereby advised not to invest or to stop investing in the investment scheme being offered by The Tipsy Tavern as well as to any other entities having the same or similar schemes and to exercise caution in dealing with any individuals or group of persons soliciting investments or recruiting investors for and on behalf of The Tipsy Tavern,” the SEC said in its advisory.