Crowdfunding SME seeks SEC help in possible fraud

MANILA, Philippines — A crowdfunding company is seeking the help of corporate regulator Securities and Exchange Commission (SEC) after one of its officers was suspected to have engaged in a fraudulent act.

In a statement, the Seedin Technology Inc. reported to the SEC that its former president, Edison Tsai, is involved in a possible and apparent fraudulent act.

As of December 2022, SeedIn’s platform has seen a total of P1.42 billion in funds raised for 296 projects.

However, SeedIn also informed SEC that it is investigating the matter and will provide more details in due time, aside from conducting a forensic audit to determine the extent of the possible fraud.

“To prevent further anomalous transactions of Mr. Tsai, SeedIn immediately replaced Mr. Tsai as president of the company with Neil Raymundo, a well-respected individual in the business community, temporarily stopped the withdrawals or payouts to investors and borrowers in its online electronic platform and reported the fraudulent act of its former president to the SEC,” the company said in its statement.

SeedIn also said this development “adversely affects or is likely to adversely affect its ability to meet its obligations or to carry out its functions under SEC Memorandum Circular No. 14, Series of 2019 (SEC MC No. 14-2019).”

The SEC is expected to investigate the matter after touting crowdfunding as an accessible and convenient means for businesses to secure funds for expansion.

SeedIn is licensed by the SEC to act as an intermediary and to operate a crowdfunding portal, providing the country’s small, medium and emerging enterprises (SMEs) with more funding options.

The company assured the public that it is coordinating with the SEC Markets and Securities Regulation Department on curative measures to protect the company and the public.

“Rest assured that SeedIn is doing everything necessary to uncover the fraud committed by Mr. Tsai and to recover any amount which may have been misused by Mr. Tsai,” it added.