SEC Issues Cease and Desist Order Against MFT Group of Companies Inc. and Foundry Ventures I Inc.
The Securities and Exchange Commission (SEC) has issued a cease and desist order against MFT Group of Companies Inc. and Foundry Ventures I Inc. for allegedly engaging in the illegal solicitation of investments from the public.
In an order dated Jan. 16, the Commission En Banc directed the MFT Group and Foundry Ventures to immediately cease and desist from further engaging in the unlawful solicitation, offer, and/or sale of securities in the form of investment contracts without the necessary license from the SEC.
The Commission also prohibited the MFT Group and Foundry Ventures from transacting any business involving funds in its depository banks, and from transferring, disposing, or conveying any related assets to ensure the preservation of the assets of its investors.
In response to the SEC’s order, the MFT Group released a statement saying, “while we have not yet officially received the complaint or the Order itself, we are actively seeking clarification and information from the SEC.” The company also emphasized its commitment to upholding the highest standards of legal and ethical conduct and expressed confidence in being able to address the SEC’s concerns promptly and responsibly.
The SEC’s order, which also covers the companies’ directors and officers, including several individuals, was issued after the SEC Enforcement and Investor Protection Department (EIPD) found that the MFT Group was offering and selling unregistered securities in the form of investment contracts to the public in the guise of borrower-lender agreements.
The enforcement department also found that the MFT Group deliberately used the term “interest income” to give semblance of legitimacy to the transactions, which the group packaged as loans and issued post-dated checks, but the amounts indicated in the checks would not be paid.
Furthermore, the MFT Group had not secured the required secondary license in the form of an approved registration statement and a permit to sell securities to the public, as required under Section 8 of the Securities Regulation Code.
The Commission emphasized that it is duty-bound to immediately stop the unauthorized investment-taking activities of the MFT Group for the protection of the investing public.
The MFT Group has stated that it operates with transparency and integrity, and is committed to working cooperatively with the SEC to resolve this matter.
