P1.4-B fund scam leaders now hiding

THE COMPOUND of SMLC-Gabai in a Lucena City village, which used to teem with vendors selling merchandise to investors in exchange for “points,” is now empty. DELFIN T. MALLARI JR./INQUIRER SOUTHERN LUZON

LUCENA CITY—Thousands of people who had invested in a money-making scheme here have been left holding the bag after key officials of the group that ran the scheme went into hiding starting on Wednesday.

Officials of South Luzon Multipurpose Cooperative-Grand Alliance of Business Leaders Association (SLMC-Gabai) had made themselves scarce after the group failed to pay the returns people who had invested in the group were expecting.

“They should face us and explain what happened to our money,” a female investor from Sariaya town, Quezon province, said in an interview at the SLMC-Gabai compound in Barangay Isabang here.

She said she had been staying at the group’s compound, hoping to get back the P70,000 she invested a week ago. She refused to be identified, as her husband was not aware of her investment.

The scheme run by SMLC-Gabai promised a 40-percent weekly interest for investments ranging from P350 to P35,000 a day. It attracted vendors, drivers, teachers and government and private employees.

People had been coming in droves since July after investors got weekly payouts of P14,000 for every P35,000 in investments.

The scheme also offered a point for every P350 in investment. Investors could use their points to buy merchandise sold at the SLMC-Gabai compound. Dealers of the merchandise, which include small home appliances, have stopped selling these due to irregular payment from the group.

Luzardo Lucido, Gabai chair and SLMC administrator, has not been seen inside the compound since Tuesday, days after investors stopped getting their weekly payments.

Since Wednesday, hundreds of restive depositors, some of them from Laguna, Batangas and Marinduque provinces, have set up camp inside the compound, hoping to get their money back.

At least two victims on Friday filed formal complaints in the police station here against SLMC-Gabai and more complainants were expected to come forward, said Supt. Allen Rae Co, Lucena police chief.

Based on figures provided by SLMC-Gabai officials, the get-rich-quick operation that lasted from July to October managed to bring in an estimated P600 million to P1.4 billion from investors.

Gerald Joseph Murillo, SLMC-Gabai account manager, who was reached by phone on Thursday from his undisclosed hiding place, said that since July, investments had reached

P5 million daily, which meant that from July to October, or 120 days, investments reached a total of at least P600 million.

He said the average daily payment for investors ranged from P2 million to P3 million.

But Camille Bautista, technical sales officer, said the total amount of investments could reach P1.4 billion.

Investors got handwritten “passbooks” as proof they had money in the scheme. An informant said it was all that people had as evidence of their investments in SMLC-Gabai.

Murillo admitted that he and wife Jenelee, the logistics officer, went into hiding, as “we have been receiving death threats.”

Murillo said the payments to investors were delayed due to heavy losses incurred by SMLC-Gabai because of irregularities in the group’s bookkeeping.

An investor, a public school teacher, admitted that people knew the risks but were attracted by the promise of big returns.