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Lucena dads warn public against investment scheme

By: - Correspondent / @dtmallarijrINQ
/ 08:00 AM October 27, 2014

LUCENA CITY—A too-good-to-be true investment scheme promising high returns has been luring thousands of investors from as far as Bicol, prompting local authorities to issue a warning.

“The public should exercise extreme caution before they invest their hard-earned money,” Lucena Mayor Roderick Alcala said in a local TV interview aired Friday.

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He said any investment offering more than 20-percent monthly profit should invite suspicion.

“Even multinational corporations and giant companies are not earning this much,” he said.

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In August, the high-yielding investment scheme offered to the public by Grand Alliance of Business Leaders Association Inc. (Gabai) based in Barangay (village) Isabang here started to spread like wildfire in this city, attracting vendors, drivers, teachers, employees, soldiers and even policemen.

Luzardo Lucido, 67, Gabai chair and deemed brain of the investment plan, said he was surprised by the flood of investors.

According to its Facebook page, Gabai was founded and registered with the Securities and Exchange Commission (CN201020246) in 2010.

Gabai holds office in a small wooden warehouse-like structure along the Maharlika Highway.

The open compound at the back of the office, which Lucido said is owned by his family, is filled with tents selling all kinds of merchandise like rice, fish, canned goods, mobile phones, television sets and DVD players, sala sets and fake signature wrist watches.

Lucido, single, and a native of Barangay Isabang, said Gabai started operation only last year.

“We intended to sell herbal food supplements to senior citizens at the start,” said Lucido.

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Evasive

But Lucido was evasive when repeatedly asked about the mechanics of his investment plan and how he is able to return a huge profit to investors in so short a time.

Lucido said Gabai is under the umbrella of South Luzon Multipurpose Cooperative (SLMC), which was founded in 2007 and has all the necessary government permits.

“The one doing business is the cooperative, not Gabai. SLMC is just using Gabai as its marketing arm,” said Lucido, who introduced himself as the vice chair of SLMC.

One of the investors explained the investment mechanics: A person is allowed to invest a minimum of P350 and a maximum of P35,000 every day.

The investor will receive a passbook with handwritten records of the investment.

The P35,000 investment continuously earns P15,000 every week as long as the principal remains with Gabai.

The investor also earns one account (this is Gabai’s term), or point, for every P350 investment (P35,000 is equivalent to 100 accounts), which the investor can use to buy from sellers of all kinds of merchandise inside the compound.

Handwritten receipt

During the payout of profits every week, the investor again receives the corresponding number of “accounts” based on his principal investment. Thus, one with a P35,000 investment earns P15,000 in profit every week plus another 100 accounts.

Despite the huge money investment, the receipt for the account that an investor will use for the purchase is only handwritten on a page of a regular receipt booklet that one can buy on a sidewalk.

A counterfeit signature wrist watch (Casio G-Shock) is worth three accounts; a case of Gatorade, seven; a big can of infant milk, seven, and a classical violin in a case, 40.

The informant said Gabai dictate the price of every item for sale inside the compound. Vendors are also required to invest a substantial amount in Gabai before they can conduct business.

No cash involved

“No cash but only ‘accounts’ are used in all purchase transactions,” said the informant who requested anonymity because his relatives have investments in Gabai.

At the end of the day, every vendor encashes all the accounts in his possession from Gabai’s cashier.

“My house is now full of canned goods, sacks of rice, electric fans and other stuff. I’m thinking of opening a store for all this,” the informant said with a laugh.

Turning serious, the informant said he had withdrawn his P35,000 investment. “There is something fishy with the operation,” he said.

When asked to comment, Lucido strongly denied that Gabai’s operations are a “scam.”

Lucido said he learned through media reports that authorities are beginning to question Gabai’s operations.

He said the group is ready to close shop and return the investors’ money once authorities order the group to stop.

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TAGS: Lucena Mayor Roderick Alcala, News, Regions
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