SEC MSRD Case No. MSRD-MID-2020-4R&L INVESTMENTS, INC., ET. AL., MARLO N. MORON

Exchange Commission Securities and

MARKETS AND SECURITIES REGULATION DEPARTMENT SPECIAL HEARING PANEL

In the matter of:

R & L INVESTMENTS, INC., ET.AL.

SEC MSRD Case No. MSRD-MID-2020-4

MARLO N. MORON,

Respondent. X

June 11, 2021

Markets and Regulation Department Assistant Direftor Adan Evan O. Pascua Securities and Exchange Commission Secretariat Building, PICC Complex, Roxas Boulevard, Pasay City.

Block 8, Lot 12, MS2, Brgy. Navarro, General Trias, Cavite. Marlo N. Moron

JHENgAZUNtEGA O(o- [U-2) GREETINGS:

in the above-entitled case, the original of which is now on file with the Commission Please take notice that on June 11, 2021, a Decision, copy hereto attached, was issued

MARLONG.FACUN SHP Chairman

Securities ond Exchange commission

REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE SECURITIES AND EXCHANGE COMMISSION PASAY CITY MARKETS AND SECURITIES REGULATION DEPARTMENT

SPECIAL HEARING PANEL

In the matter of:

R & L INVESTMENTS, INC., ET.AL.

SEC MSRD Case No. MSRD-MID-2020-4

MARLO N. MORON,

Respondent.

DECISION

SRC Rule 52.1.7.5.2. of the Investigation and Review Committee ("IRC"} composed of officers and personnel of the Markets and Securities Regulation Department (MSRD) of the Securities and Exchange Commission ("Commission") charging Marlo N. Moron ("Moron"), an employee of R&L ("SRC") in relation to Rule 26.1 of the 2015 SRC Implementing Rules and Regulations ("SRC Rules" or "SRC-IRR") and Section 54 of the SRC; and, (2) Section 28 of the SRC in relation to Investments, Inc. ("R&L) for violation of: (1) Section 26 of the Securities Regulation Code Before the Special Hearing Panel ("SHP") is a Formal Charge dated September 2020

ANTECEDENT FACTS AND STATEMENT OF THE CASE

No. MP-2019-001 ordered the Capital Markets Integrity Corporation ("CMIC') to take over the operations of R&L Investments, Inc. ("R&L"), pursuant to Section 33.1 (d) of the SRC and Rule 33.1.1.26.3 of the SRC-IRR. On 14 November 2019, the Securities and Exchange Commission in SEC En Banc Case

R&L rendering it incapable of meeting the demands of R&L's client security holders and the payment of their share proceeds. The Take Over Order was issued due to the deterioration of the financial condition of

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by the respondent that resulted in the loss of P700 Million worth of client shares of R&L. The deterioration was brought about by the fraudulent scheme allegedly employed

however, preclude the Commission from continuing its own examination, investigation, or the provisions of the SRC and its Implementing Rules and Regulations possibly committed by R&L Investment Inc., its officers and employees and to submit its report and recommendations to the Markets and Securities Regulation Department for the purpose of instituting administrative or criminal action against the responsible persons. This does not, filing of any action against respondent R&L Investment Inc. and its responsible officers and employees. Under the Order, the CMIC was also directed to determine the various violations of

possibly committed and to institute, among others, the appropriate administrative charges against all the responsible persons, including R&L, its officers and employees. investigation of the incident to determine the various violations of the securities laws Consequently, the Commission directed the MSRD to conduct a thorough

its officers and employees, Venture Securities, Inc. ("VSI" or "Venture Securities") and its officers and employees and Julieto Sulapas. subpoenas were issued by the IRC to herein Respondent, R&L Investments, Inc., ("R&L") and Pursuant to the direction, MSRD created the IRC to conduct the investigation. Hence.

at Block 8, Lot 12, MS2, Brgy. Navarro, General Trias, Cavite and to Atty. Angelyn Gonzaga at her business address in Suite 29, 3/F Legaspi Towers 300, 2600 Roxas Blvd. cor. P. Ocampo St., Malate, Manila. However, the Respondent did not appear before the investigating body. The subpoena for the Respondent Marlo Moron was personally served at his address

created to hear, resolve and decide matters relative to the case. On 5 February 2020, the Special Hearing Panel composed of the undersigned was

dated September 2020 against the Respondent. After conducting the investigation, the IRC formally instituted the Formal Charge

In the Formal Charge, Complainant alleges that:

SRC, in relation to Rule 26.1 of the SRC-IRR and Section 54 of the SRC For violation of Section 26 of the

1 The documents received from the Philippine Depository and Trust Corporation

2019, the herein Respondent was the maker and Lucy Linda Lee was the checker in the B231AC03). It was also revealed in the same documents that, for the period of 2017 to Lucy Linda Lee (User ID No. B231AC01) and Respondent Marlo Moron (User ID No. ("PDTC") identified the Maker and Checker of pertinent R&L EQ Trade1 transactions as

without change of beneficial ownership thereof. These transactions are executed outside the trading platform of the Philippine Stock Exchange ("PSE"). Such transfers of securities are : accounts in the Philippine Depository and Trust Corporation ("PDTC"), the central depository of securities that are traded in the PSE for equity securities and the Philippine Dealing and Exchange Corporation ("PDEX") for fixed income securities. transfer of equity securities from the account of one broker to the account of another broker and vice versa In the securities market, the EQ Trades or Done-Thru Trades are transactions between brokers for the recorded in the brokers' respective

Inc. In the case at bar, the questioned EQ Trades pertain to EQ Trades between R&L and Venture Securities,

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transaction was executed with Lucy Linda Lee as Maker and Respondent as Checker. EQ trade transactions of R&L, except for one instance. On February 20, 2017, an EQ trade

2. Lucy Linda Lee claimed during the investigative proceedings that Respondent knew the from the maker and checker access, she also gave herein Respondent her admin access to the PDTC system. credentials for both maker and checker. It is also revealed by Lucy Linda Lee that, aside

3. Respondent Moron, in his Counter-Affidavit dated December 4, 2019 submitted in the the orders of Lucy Linda Lee. INQ-19K, categorically admitted that he "processed" the transfer of shares, allegedly by criminal case before the prosecutor's office of Mandaluyong City with Docket No. XV-06-

4 As the maker, Respondent was able to initiate the processing of the EQ trade

transactions. The checker would then validate and approve the transactions. The PDTC documents reveal that'Lucy Linda Lee was the checker.

5. In order to complete an EQ trade transaction, there must be a receiving account in Trade transfers were received and recorded by Venture under the Julieto Sulapas another broker dealer. In this case, Julieto Sulapas had been giving instructions to Venture Securities, Inc. to receive certain shares from his account with R & L. These EQ account.

6. Julieto Sulapas ledgers in Venture Securities reveal that R&L client stocks amounting to a total worth of Php1,130,508,721.09 were transferred from R&L to the Julieto Sulapas account in Venture via simulated EQ Trades.

7. However, when the Julieto Sulapas ledgers of R & L were compared to that of Venture, it was discovered that the shares transferred to Venture do not exist or recorded in his to the Julieto Sulapas account in Venture came from the accounts of the other clients of R&L. No documents showing any authority from these other clients to transfer the shares were submitted during the investigative proceedings. R&L account as of the date of his requests. Therefore, the shares that were transferred

8. Further, a review of the Julieto Sulapas account ledger with Venture Securities revealed of the proceeds were used to pay for the purchased shares from the market which shares were subsequently sold. The proceeds are then collected by Julieto Sulapas. that the transferred shares from R&L were sold via the PSE system. The corresponding cleared checks show the name of Julieto Sulapas as payee on the said instruments. Some

Lucy Linda Lee stated during the investigative proceedings and in her Supplemental in order to hide the above mentioned schemes. Complaint-Affidavit submitted to prosecutor's office that the respondent allegedly faisified the PDTC reports amounting to discrepancies of approximately PHP 700 million

10. Furthermore, the investigation leading to the issuance of the Take Over Order No. MP- portfolio per R&L records compared to PDTC records, to wit: 2019-001 revealed that there are discrepancies between the balances of the R&L client

Period R&L Investment Per Books of Inc. Depository Trust Per Philippine Corporation Approximate Difference Absorbing Losses Net Asset before Absorbing Losses Estimated Net Asset after

31, 2018 December Php 738,897,290 Php 132,255,939 Php (606,641, 351) Php 46,815,973 Php (559,825,378)

August 31 2019 Php 743,405,682 Php 31,544,255 Php (711,861,427) Php 47,501,077 Php (664,360,350)

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October 31, 2019 Php 747,819,698 Php 30,395,892 Php (717,423,806) Php 51,692,706 Php (665,731,100)

11. Delving further into the discrepancies, the Investigation and Review Committee of 31 October 20192, focusing on six kinds of stocks as sample (NI, SECB, LMG, MWC, GLO and ABS). It was discovered that 300,000 NI shares, 3,000 SECB shares, all 100,000 LMG shares, 25,000 MWC shares, 200 GL0 shares and 15,000 ABS shares of various R&L clients were missing as of 31 October 2019. compared the customer account ledgers of R&L against obtained BP Portfolio Reports as

12. During the investigation, it was further discovered that Respondent employed any of these two means every time an R&L client, whose stocks he already transferred to the Julieto Sulapas in Venture Securities, orders a sale, thus:

Sulapas account in Venture to R&L and returned to the other broker dealers; or, a. The Respondent borrowed shares from other broker dealers to satisfy the order of the client. Similar stocks will be bought from the market through the Julieto Sulapas account in Venture. Finally, the stocks purchased are EQ traded from the Julieto

b. The Respondent bought stocks (with similar issuer to that of the stocks sold by the selling client) through the Julieto Sulapas account in R&L. The stocks purchased by the Respondent will then be used to settle the transaction of the selling client. 13. Respondent was able to employ the above-mentioned scheme by virtue of the written authority given to him by Julieto Sulapas to transact over his Venture Securities account.

14. It was also claimed by Lucy Linda Lee and Jonathan Lee that Respondent tampered the PDTC reports in order to hide the unauthorized transfer of R&L client shares via EQ trades to the Julieto Sulapas account in Venture Securities.

15. Moreover, Respondent admits in his Counter-Affidavit that he would receive a share of allegedly from Lucy Linda Lee. the proceeds from the sale of the stocks sold through the Julieto Sulapas account with Venture. He also admits that he receives 3% the proceeds as commission later on,

2015 SRC Rules Securities Regulation Code in relation to Rule 52.1.7.5.2 of the For violation of Section 28 of the

1 During the investigation proceedings, Lucy Linda Lee admitted that the Respondent had

access to the trading floor and that he also executed trades;

2. The Respondent admits in his Counter-Affidavit that he has access to the trading floor and that he traded stocks despite knowing that he does not have the license to do so; 3. The Securities Regulation Code prohibits a person to act as a salesman without being registered as such salesman.

Considering the fact that the Respondent is not a registered salesman, he should not have performed and executed the buying and selling of securities.

following: In support of the allegations, Complainant attached in the Formal Charge the

2 As submitted by PDTC.

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(iv) (Ii ( (i Letter dated 29 January 2020 of PDTC pertaining to the identity of the Maker Counter-Affidavit dated December 4, 2019 of Marlo Moron filed with the City Take Over Order dated 14 November 2019 issued by the Commission; and Authorization letter dated 30 May 2012 issued by Julieto Sulapas authorizing Marlo Moron to manage his account with VSI. and checker of R&L EQ Trades; prosecutor's office of Mandaluyong City:

would be considered as a waiver thereof. from receipt hereof, otherwise, his failure to submit his answer within the required period Procedure of the Commission, he was directed to submit his Answer within Fifteen (15) days The Formal Charge was sent to the Respondent. Pursuant to the 2016 Rules of

due to his failure to file the same within the reglementary period. Answer to the Formal Charge. He was thus deemed to have waived the filing of an Answer address by a certain Jenny Rose Zuniega on 07 September 2020. Marlo Moron did not file his Records of the case show that the Formal Charge was received at Marlo Moron's

the submission of the following additional documentary evidence: On 15 April 2021, Complainant submitted a manifestation and motion requesting for

2. Supplemental Affidavit of Respondent dated 08 March 2021 3. CMIC Report dated 19 December 2019 4. The EQ trade Forms of Respondent with VSI that were transferred from R&L to VSI 1. Sinumpaang Salaysay of Respondent dated 17 September 2020 via EQ Trade to Mr. Sulapas Account in VSI

date, the panel issued a resolution submitting the case for decision sans Answer. at Respondent Moron's address in General Trias, Cavite on 15 April 2021. A copy of the Makati City on 16 April 2021. The panel have not received the comments/opposition from the Respondent. There being no comment/opposition and considering that the additional documentary evidence appears to be relevant in the instant case, the panel granted the motion in its Order dated 1 June 2021 and the documents submitted were admitted. On even Manifestation with Motion was also tendered at the Respondent's address at West Rembo, Per records, the manifestation with motion was received by a certain Jheng A. Zuniega

ISSUES

1. Whether or not the Respondent Marlo Moron violated Section 26 of the SRC in relation to Rule 26.1 of the SRC Rules and Section 54 of the SRC.

2. Whether or not the Respondent Marlo Moron violated Section 28 of the SRC in relation to SRC Rule 52.1.7.5.2.

THE RULING

2015 SRC Rules and Section 54 of the SRC. 26 of the SRC in relation to Rule 26.1 of the Respondent Marlo Moron violated Section

demonstrating the commission of fraud in violation of SRC Section 26 in relation to SRC Rule 26.1. In the case at bar, Complainant has sufficiently discharged the burden of

Section 26 in relation to Section 54 of the SRC, provides:

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or indirectly, in connection with the purchase or sale of any securities to: "SEC. 26. Fraudulent Transactions. - It shall be unlawful for any person, directly

26.1. Employ any device, scheme, or artifice to defraud;

XXX 26.3. Engage in any act, transaction, practice or course of business which operates or would operate as a fraud or deceit upon any person Rules 26.1 of the 2015 SRC Rules provides:

of business which operates or would operate as a fraud or deceit upon any 26.1. It shall be unlawful for any person, directly or indirectly, in connection with the purchase or sale of any securities to: (i) employ any device, scheme or artifice to defraud; (ii) obtain money or property by means of any untrue statement of a made, not misleading; or (iii) engage in any act, transaction, practice or course person. material fact of any omission to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were

While Section 54 of the SRC provides:

statements therein not misleading; or, in the case of an underwriter, has failed to has refused to permit any lawful examinations into its affair, it shall in its discretion, and subject only to limitations hereinafter prescribed, imposed any or all of the following sanctions as may be appropriate in the light of the facts and circumstances: subject to supervision who commits any such violation; (c) Any registrant or any person has, in a registration statement or in other reports, applications, Commission, made any untrue statement of a material fact, or omitted to state conduct an inquiry with reasonable diligence to ensure that a registration statement is accurate and complete in all material respects; or (d) Any person Section 54. Administrative Sanctions. - 54.1. If, after due notice and hearing, the Commission finds that: (a) There is a violation of this Code, its rules, or its orders; (b) Any registered broker or dealer, associated person thereof have failed accounts, records or documents required by law or rules to be filed with the any material fact required to be stated therein or necessary to make the reasonably to supervise, with view of preventing violations, another person

(P2,000.00) for each day of continuing violation; {ii) A fine of no less than Ten Thousand Pesos (P10,000.00) nor more than One Million Pesos (P1,000,000.00) plus not more than Two thousand pesos XXX

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operates or would operate as a fraud or deceit upon any person." security "(1) to employ any device, scheme, or artifice to defraud, or (2) to obtain money or property by means of any untrue statement of a material fact or any omission to state a material fact . . ., or (3) to engage in any transaction, practice, or course of business which Section 26 of the SRC makes it unlawful for any person in the offer or sale of any

Sections 26(1) and 26(3) of the SRC as the provisions violated by the Respondent, it defraud and a transaction, practice, or course of business which operates or would operate as a fraud or deceit upon any person. appearing that the allegations involves the employment of a device, scheme, or artifice to A perusal of the Formal Charge will readily reveal that the Complainant is pointing to

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relation to SRc Rule 26.1 pertaining to the Sulapas account transactions based on the following attendant circumstances. An examination of the records reveals that Marlo Moron violated SRC Section 26 in

Moron, Respondent Moron instructed these shares to be sold/traded in numerous transactions for several years. Ledger in R&L shows that the securities that were transferred to Venture thru EQ trades were not recorded in Sulapas' ledger, hence, the shares were not owned by Sulapas but from other clients of R&L. On the strength of the authorization allegedly issued by Sulapas to R&L to Venture thru EQ Trades using Julieto Sulapas' accounts in R&L and Venture. Sulapas' First, the herein Respondent facilitated the unauthorized transfer of securities from

balances in order to hide the unauthorized transfer of R&L client shares,via EQ trades to the his Counter Affidavit. Julieto Sulapas account in Venture. This allegation was also admitted by the Respondent in Person, respectively, alleged that Respondent tampered the PDTC reports on R&L shares Second, Lucy Linda Lee and Jonathan Lee, R&L's registered Salesman and Associated

reports on R&L's securities balances in the PDTC amounting to the discrepancies of approximately PHP 700 million in order to hide the above mentioned schemes. Lucy Linda Lee stated during the investigation that Respondent falsified the PDTC

admin system access provided to him by Ms. Lee. Even though Respondent was aware of the prohibition, he still actively facilitated the illegal trades using the said access. In other words, Respondent was able to continuously conduct the illegal transactions in the Sulapas account through his unauthorized checker access and Third, as the maker, Respondent is prohibited to act as a checker at the same time.

and checker access, she also gave herein Respondent her admin access to the system. credentials for both maker and checker of R&L EQ Trade transactions. Aside from the maker Fourth, Lucy Linda Lee stated during the investigation that Respondent knew the

the stock securities registered under the name of R&L to another broker, making an agreement with Mr. Sulapas to represent R&L in the transaction since the stocks securities are in the name of R&L, allowing the EQ trade transactions without the authority from the owners of the shares, and receiving commission from the transactions. registered or licensed as a trader, having an access to the on-line system of PDTC transferring execution of the fraudulent activities, acted as a salesman of securities despite not being Fifth, respondent stated in his Counter-Affidavit that he assisted Lucy Linda Lee in the

Below are the Respondent's relevant statements in his Counter-Affidavit, thus:

appear that the client already received their SOA when in truth and in fact, the said SOA blood or consanguinity or a friend of her. The sending of SOA to Complainant's clients is reported to. PDTC as one of its reportorial requirements. So, to make it appear that Complainant is complying with said requirement, Lucy_manipulates said SOA. Statement of Accounts (SOA) of Complainant's clients. At her instance, she would make it was sent and delivered to an address not of the client but of someone related to Lucy by personally manipulating the records and documents of the company such as the "1.3 It was after learning the concept of the business that I discovered that Lucy has been

questions were still unanswered then. 1.4 I later discovered that such is being done by Lucy since the Statement of Account, if actually sent to the client, would lead to the latter's detection that the same does not reflect the true and correct number of their shares of stocks. As to how and why, such

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them. However, the checks being issued by Lucy are actually payable to the order of by Lucy would have already amounted to millions of pesos throughout all the years that she has been the "boss" of the company, Lucy, I again discovered that Lucy was stealing money from clients through their dividends and other benefits due them, Lucy would order us to check the records and segregate, the shares belonging to clients who are "inactive" from those who are "active." After determining those, Lucy would issue dividends through checks supposedly in favor of the clients who are "inactive" and make it appear that those were in fact collected by "CASH" making it easy for her to encash the same for her personal gain and benefit. And, considering the number of clients and their respective shares, the amount actually taken 1.5 As I continued working for the Complainant under the control and supervision of

includes assigning me to the trading floor despite not having a license as a trader. She respective shares of stocks. 1.6 After years of working for the Complainant, I was given more tasks by Lucy which Said that it was okay as long as I have her permission, There, I was tasked by her to trade stocks for the clients which she, as a licensee, is the only authorized trader in the company. She likewise gave me the responsibility of doing her primary responsibility for her relating to the online Portfolio of the company containing lists of clients with their

access to, Lucy started giving me orders to transfer the stock 'securities which are all registered under the name of R & L Investments, Inc. to another broker for them to sell the same and give her the proceeds after. 1.7 When Lucy let me have access to the on-line system of PDTC, which only she had an

another broker under the name of someone who can represent the Company in collecting brevity), one of Complainant's clients, and told me to contact him and ask him to represent the Complainant to get the proceeds of the sale of stocks securities in behalf of the latter, which ultimately pertained to Lucy. 1.8. When she asked me to do it the first time, she gave me instructions to transfer it to the proceeds. Lucy then gave me the information about Julieto Sulapas ("Sulapas" for

Sulapas and made an agreement with him to represent Complainant in the mentioned transaction. Being an agent of the Complainant, Sulapas would then encash the check which was issued under his name. After encashment, he would turn-over to me the amount less his 3% commission. After receiving the amount from Sulapas, I would immediately turn-over the proceeds to Lucy. At first, Lucy would give me an amount for every transaction as, possibly, a token for following her instruction. But later on, she would likewise give me at most 3% of the amount as a commission since I am also serving as her agent in said transaction. 1.9. Following the order of Lucy, believing in good faith that said transaction is regular and in order since the stocks securities are in the name of Complainant, I looked for

representatives. Indeed, the broker from the Venture Securities no longer required any for said transaction, she just told me to still proceed even without it since it has already been a practice amongst brokers to rely on the representation of each company's written authority from the company. 1.10 As a matter of policy, every transfer of stocks to another broker, in this case Venture Securities, should be evidenced by an authority from the company before the transaction can be processed by said broker. When I asked for the first time an authority from Lucy

1.11 Since then, every transaction with Venture Securities relating to the transfer of stocks would be successfully processed.

1.12 To repeat, all the proceeds of the transfer of stocks that were given to me by Sulapas were immediately turned over to Lucy who would then give me an amount as my commission.

reports are the ones given to the auditor for verification. 1.13 After which, she would instruct me to do download and print the BP Portfolio Report already reflecting the adjusted entries therein. Under her instruction, said printed

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there will be a change of ownership. September or October 2019 when I learned that the company is already about to be sold to another company. This would mean that an inventory of stocks is forthcoming since 1.14 The transferring of stocks has been going on for several years until sometime in

broker as she does not want her siblings to feel betrayed by her. any irregularity that may be discovered as a result of the transfer of stocks and the encashment of the dividends belonging to the clients. She assured me that I just need to speak to her siblings and undertake to return the missing amount, if any, and everything will turn out well. She said that she will take the matter from there but one thing she has given me authority to proceed with all the transfer of stocks securities to another 1.15 It was at this moment that Lucy told me her concerns. In order to avoid being answerable to her siblings who are co-owners of the company, Lucy told me to own up to emphasized during our conversation was that I should not mention her name as one who

ways to cover the shares of stocks we have previously transferred to another broker. lead in the present situation. Besides, she said that I will only need to do it if she will be 1.16 Having worked for her for several years already, I trusted her words and took her confronted by her siblings about it. For the meantime, like before, she told me to find

XXX

received checks issued by VSI and the fact of receiving money from the transactions of his VSI account: Sixth Mr. Sulapas in his affidavits, respectively narrated his participation on how he

Sulapas' Sinumpaang Salaysay

Sinabihan niya ako na kumuha na lang daw ako ng parte ko doon sa pera. Sinasabi niya kung magkano kukunin ko, tapos yung iba sa kanya ko ibinigay. Ganun lang po palagi. Napansin ko din na palaki nang palaki yung halaga ng tseke at padami din sila nang ako. Pagdating ko ng PSE trading floor, may mga tseke na na dala si Mar at pinapirmahan Tinanong ko si Mar kung bakit hindi na Golden Tower. Parang galit siya nung sumagot at sinabi niya na hindi raw maayos ang mga tao doon sa Golden Tower. Tapos tinuro ni Mar sakin saan puede mag encash, kaya nag-encash ako. Wala naman naging problema. padami; "16. Na makalipas ang isang buwan, pinapunta ako ulit ni Mar sa kanya at may tseke daw niya sakin ang mga dokumento. Ventures Securities na yung issuer ng mga tseke.

Mar na i-deposit sa account yung pera. Sasabihin lang niya sa akin yung detalye ng account at kung saang bangko; tapos ang iba ibibigay ko lang sa kanya. Nung palaki na ng palaki, inuutusan na ako ni 17. Na Union Bank saka Bangko de Oro ang mga tseke na natatanggap ko. Hiwa-hiwalay sila at hindi isang tseke lang. Sasabihin lang ni Mar sakin kung magkano ang para sa akin,

encash, sasabihin ni Mar kanino ko -deposit, at magkano dun yung para sa akin. Yung natitirang pera, ibibigay ko kay Mar; 18. Na may pagkakataon na inutusan niya ako na pumunta ako sa Ventures para kunin ang tseke. Hanapin ko raw si "Krystel". Ginawa ko naman iyon, at paglabas nung Krystel, dala dala na niya ang tseke. Pinirmahan ko ang mga papeles, at pagkatapos ko mag-

si Venture Securities, at pagdating ko sa Union Bnak, handa na ang pera. Minsan inuutusan din ako ni Mar na bumili ng dollars, na sinusunod ko din naman. Puede naman] po kasi meron naman ako account dun; umabot na sa Php1,000,000. Dahil dito, sinbihan ako ni Union Bank na baka puede, kapag Php1,000,000 mahigit na yung tseke, itawag muna nang isang araw bago ako magpunta para mag-encash upang mahanda nila ang pera. Kaya sa pagkakaalam ko, tumatawag na 19. Na palaki nang palaki ang halaga ng mga tseke na pinapa-encash sakin ni Mar. Minsan

bangko. Minsan inaabot na ako hanggang hapon, tapos wala pa akong pananghalian. ni Mar sakin. Ako iyong nag-de-deposit, nakapila at naghihintay pa pag bibilangin sa 20. Na nung nagtagal, humihingi na ako ng mas malaking bayad kasi andaming inuutos

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pera tapos lalakad-lakad pa; niya sa akin. Alam naman niya na nakakatakot yung ang laki laki ng halaga ng dala among Kaya humihingi ako na baka puede niya naman dagdagan. Sabi ni Mar sakin, tabla naman daw yun, pero sasabihan niya may-ari ng pera. Sabi niya, 2.5% na raw yung binibigay

XXX

Mar na andun na ako at siya naman mag-te-text kay Larry. Ibibigay ko na kay Mar yung naiwang pera; 23. Na kapag na-encash ko na ang tseke at natapos ko na ang pinapagawa ni Mar, sasabihin niya lang sakin na kumuha ako sa pera nang ganitong halaga, minsan umaabot Doon ko pinupuntahan si Larry sa STI building sa baba ng opisina niya. Tinetext ko si sa Php70,000. Inuutusan din ako ni Mar na bigyan ko din daw si Larry ng ganitong halaga.

Xxx

ko. Yung Union Bank account ko po kasi, inutusan ako ni Mar na buksan nung palaki na ng palaki ang halaga ng mga tseke. Hindi ko naman alam na di pala legal yung ginagawa naming. Wala naman po problema sakin na buksan iyon, kasi maintaining balance lang 26. Na handa po ako na bukasan ang account ko sa Union Bank para linisin ang pangalan naman yung andun;

XXX

ko rin naisipan magtanong tungkol sa mga autos ni Mar kasi broker ko naman siya; 30. Na wala po akong kinalaman sa mga nangyayari. Yung sinasabi po nila na ninakaw yung pera, wala po akong alam doon at wala naman po akong ninakaw. Iyong nakuha kopo ay bigay lang sa akin ni Mar bilang bayad nila sa mga pinapagawa nila sa akin. Hindi

XXX

32. Na dati po sa PSE ako pumupunta pero nung lumaon sa Venture na, dun kay Krystel ng Venture. Binibigyan po ako ng utos kung saang account ko ide-deposit ang pera. Pagka-deposit ko ng pera, sasabihin ni Mar sakin na sakin na yung ganitong halaga, at kay Mar na yung natitira;

33. Na sa pagkakatanda ko, yung pinakamalaking halaga ng tseke na pina-encash ko, mga Php16,000,000. Akala ko nga bibigyan ako ng malaking bayad doon, pero sabi ni Mar Php200,000 lang yung para sa akin dun; XXx

niya lang ako parte ng kinita niya; na sinabi ni Mar na may "pinasabay" siya, akala ko legal yun. Ang pagkakaintindi ko sa "pinasabay" ay baka nag-invest din si Mar at sinabay lang niya sa akin, tapos binigyan 44. Na aaminin ko na natutuwa ako na nakakatanggap ako ng pera. Noong unang beses

45. Na hindi rin ako nagtanong kung bakit ganun kalaki ang mga tseke na natatanggap ko pero hindi naman sakin napupunta yung buong pera, kasi nagtiwala lang po ako kasi kay Mar. Yung ibang mga nagyari, wala na ako alam dun;

kaya naisip ko na baka kumita siya at binibigyan lang niya ako ng balato. Hindi ko kinuwestiyon kung bakit nakapangalan sakin ang mgs tseke, maliban lang nung nagpalit ng issuer mula sa Golden Tower papunta sa Venture; 46. Na, sa mga nangyari, ang alam ko si Mar ang may pakana. Bibibigyan lang niya ako,

XXX

Sulapas Supplemental Affidavit

pinabili ko na shares sa kanya na hindi ko mabenta. Sabi ni Marlo ay nalugi raw pero "xix. Na nuong unang nag-abot sa akin ng tseke si Marlo, naisip ko na iyon ay mula sa

Page 10 of 27

Nagsimula na po akong magkaroon ng hinala nuong napapadalas na siyang magpa- encash sa akin. Naiasip ko na baka yung pera ko ay ginamit niyang pambili para sa sarili niyang shares na pinapasabay niya at binibigyan na lang niya ako ng porsyento; hindi ko alam kung bumili siya o nagkaroon ng ibang transaksyon kasi wala naman siyang binigay sa akin. Binigyan lang niya ako ng tseke na pina-encash ko naman.

XXX

xxvi. Na may mga pagkakataon na walang instruksyon sa akin si Marlo kung saan ako binibigay ko ang pera kay Marlo. Ang buong halaga ay binibigay ko kay Marlo, pagkatapos makuha and aking bayad o "butal"; magde-deposit. Sa mga ganitong pagkakataon, nagpapa-encash na lang ako ng tseke at

sakin na, " Tabla lang yung may-ari niyan eh;" Humigit kumulang nasa P5,000,000 po ang total na nakuha ko sa mga transaksyon. 3% ang pinakamalaking parte na natanggap ko. Yung iba nasa 1.5% yung porsyento ko. kumukuha ako ng 3% bago ko binibigay kay Marlo Moron. Mga sampung beses na walang binanggit na halaga sa akin si Marlo, kaya 3% yung kinukuha ko. Kapag naman sobrang laki ng halaga ng tseke ay pinapakiusapan ako ni Marlon a mas mababa sa 3% ang kunin kong porsyento. Kapag nakikiusap ako na lakihan ang parte ko sa pera, sinasabi ni Marlo xxvii. Na ang natatanggap ko lang na halaga ay ayon sa sinasabi ni Marlo sa akin. Nasa Kapag walang sinabi ni Marlo sa akin kung magkano ang aking prosyento sa pera,

XX

transaksyon kasama si Marlo Moron;" xxxviii. Na nakatanggap ako ng mga nasa Php5,000,000.00 lahat-lahat mula sa mga

indeed, the latter transacted with the former regarding the Sulapas account securities transaction in VSI and R&L, the check encashment issued under the Sulapas name, the to Respondent after Mr. Sulapas deducted his commission. commission received by Sulapas and the turn-over of the proceeds of the check encashment On the whole, Sulapas' affidavits corroborate Respondent Moron statement that

already knew from the start that there were irregularities in the transaction with Vsi relating to the transfer of stocks and that he received commission money from the transactions. Those facts are suspicious in itself. His claim of good faith is unnatural to be believable and contrary to human experience. In this situation, the more natural thing for him to do after knowing such irregularities is to refuse to act or facilitate the illegal that the Sulapas Account transaction is regular and in order as he himself admitted that he transactions. From the foregoing, Respondent cannot claim good faith based on his alleged belief

Forms of Mr. Sulapas. In several occasions, Moron fraudulently transferred shares of stocks, in VSI and were sold and traded for their benefit. Moron fraudulently hid these unauthorized transfers by forging the securities balances reports that were generated by the PDTC system. trade Forms of Mr. Sulapas with VSI, there were Three Hundred Seventy Nine (379) One Hundred Sixty Seven (167) Stock Credit Memo. Indeed, the fraudulent acts of Moron in which Sulapas did not own but owned by other clients of R&L, from R&L to Sulapas' account submitted during the investigation, the CMIC Report dated 19 December 2019 and the EQ unauthorized EQ Trade transactions in the Sulapas Account from R&L to VSI consisting of violation of Section 26 of the SRC were clearly shown in these account ledger and EQ Trade Finally, as observed in the account ledger of Mr. Sulapas (SU026, VSI account)

Account were as follows: The shares transferred from R&L Investments to VSI via EQ Trade to the Sulapas

Page 11 of 27

DATE Date 2 TXN REF Ledger Reference STOCK SHARES TRANSFER

5/30/12 Wednesday, 30 May 2012 SCM 5422 CLG91619769 PXP 5 2,500 R&L

6/28/12 Thursday, 2012 28 June SCM 5562 CLG91682704 D 50,000,000 R&L 7/10/12 Tuesday, 10 July 2012 SCM 55 9 CLG91708880 BLOOM 300,000R&L 8/ 6/12 Monday. 2012 6 August SCM 5 654 CLG91766336 CAL 250,000 R& 8/24/12 8/24/12 10/ 5/12 10/5/12 11/26/12 Monday, 26 November Friday, 5 October 2012 Friday, 5 October 2012 2012 Friday, 24 August 2012 Friday, 24 August 2012 SCM SCM SCM SCM SCM 5677 5677 5751 5751 5 959 CLG0000091887622 CLG92002330 CLG91798999 CLG97644751 CLG97680604 SMC MA MAB MA MAB 50,000,000 50,000,000 20,000,000 50,000,000 30,000 R&L RL R&L R&L R&L

2/ 6/13 Wednesday, February 2013 6 SCM 6108 CLG092194196 CT 100,000 R&

6/18/13 6/18/13 5/21/13 7/ 3/13 Wednesday, Tuesday, 18 June 2013 Tuesday, 18 June 2013 2013 Tuesday, 21 May 2013 3 July SCM SCM SCM SCM 6421 6437 6396 6421 CLG92653691 CLG092595423 CLG092499288 CLG092595422 FPH NKL PGOLD PGOLD 200,000 200,000 300,000 50,000 R&L R&L R R&

7/5/13 7/24/13 Friday, 5 July 2013 Wednesday, 24 July 2013 SCM SCM 6460 6438 CLG92661845 CLG0000092706183 PGOLD PGOLD 200,000 100,000 R&L R&L

9/20/13 Friday, 20 September 2013 SCM 6581 CLG92856036 PX 500,000 R&L

6/24/14 11/ 7/14 5/16/14 6/24/14 6/24/14 Friday, ? November Tuesday, 24 June 2014 2014 Friday, 16 May 2014 Tuesday, 24 June 2014 Tuesday, 24 june 2014 SCM SCM SCM SCM SCM 7794 7149 7149 7112 7149 CLG93656343 CLG93656342 CLG094065164 CLG93537924 CLG93656344 MA IS NIKL APC GTCAP 100,000,000 22,000,000 3,000,000 300,000 10,000 R& R&L R&L R&L R&

11/13/14 Thursday. November 2014 13 SCM 7844 CLG094082807 IS 30,000,000 R&L

11/28/14 Friday, 28 November 2014 SCM 7879 CLG094127975 IS 40,000,000 R&L

12/19/14 Friday, 19 December 2014 SCM 7940 CLG094202353 IS 40,000,000 R&&L

3/19/15 Thursday, 19 March 2015 SCM 8070 CLG094487483 NIKL 600,000 R&L

3/25/15 Wednesday, 25 March 2015 SCM 8071 CLG094512831 AGI 200,000 R&L

3/25/15 2015 Wednesday, 25 March SCM 8071 CLG094512832 MER 20,000 R&L

4/14/15 5/11/15 5/13/15 4/10/15 Friday,10 April 2015 Monday, 11 May 2015 Wednesday, 13 May Tuesday, 14 April 2015 2015 SCM SCM SCM SCM 8157 8164 8088 80 90 CLG094552996 CLG094654505 CLG0000094563963 CLG09465655 CHIB NIKL GTCAP NIKL 600,000 400,000 200,000 29,000 R&L R&L R&L R&L

Page 12 of 27

6/ 4/15 Thursday, 4 June 2015 SCM 8183 CLG094743272 NIKL 100,000R&L 6/10/15 Wednesday, 10 June 2015 SCM 8190 CLG094761172 NIKL 200,000 R&L 7/ 9/15 10/15/15 Thursday, 9 July 2015 Thursday, 15 October 2015 SCM SCM 8412 8221 CLG094856271 CLG0000095182424 NIKL GTCAP 400,000 7,000 R&L R&

12/29/15 Tuesday, 29 December 2015 SCM 8583 CLG95399102 CHIB 300,000 R&L

1/13/16 Wednesday, January 2016 13 SCM 85 5 CLG095433563 MER 14,000 R&L

2/26/16 Friday, 26 February 2016 SCM 8659 CLG095570074 BLOOM 1,000,000 R&L

2/26/16 Friday, 26 February 2016 SCM 865 9 CLG095570075 PX 200,000 R&L

2/26/16 Friday, 26 February 2016 SCM 8659 CLG095570081 MER 11,000 R&L

2/26/16 Friday, 26 February 2016 SCM 8659 CLG095570077 FPH 45,000 R&L 6/20/16 Monday, 20 June 2016 SCM 8843 CLG095985699 LR 1,000,000 R&L

6/22/16 Wednesday, 22 June 2016 SCM 8872 CLG95998864 CYBR 5,000,000 R&L

6/22/16 Wednesday, 22 June 2016 SCM 8872 CLG95998865 PX 200,000 R&L

6/29/16 Wednesday, 29 June 2016 SCM 8905 CLG096018307 APC 8,000,000 R&L 7/12/16 Tuesday, 12 July 2016 SCM 8927 CLG96063001 FGEN 300,000 R&L

7/22/16 7/22/16 Friday, 22 July 2016 Friday,22 July 2016 SCM SCM 9043 9043 CLG096106357 CLG096106284 AL SMC 100,000 30,000 R&L R& 7/22/16 Friday, 22 July 2016 SCM 9043 CLG096106283 EW 250,000 R& 7/22/16 Friday, 22 July 2016 SCM 9043 CLG096106285 DD 100,000 R 7/22/16 9/ 2/16 Friday, 22 July 2016 Friday, 2 September 2016 SCM SCM 9162 9043 CLG096106282 CLG96265097 NIKL DDPR 500,000 100,000 R&L R&L

9/ 6/16 Tuesday, 6 September 2016 SCM 916 CLG096273897 SMC2D 130,000 R&L

10/25/16 Tuesday, 25 October 2016 SCM 9365 CLG96446490 MWIDE 300,000 R&L

11/9/16 Wednesday, November 2016 9 SCM 9446 CLG96492824 SHLPH 500,000 R&L

11/22/16 Tuesday, 22 November 2016 SCM 9470 CLG096537748 SHLPH 200,000 RL

11/24/16 November 2016 Thursday, 24 SCM 9475 CLG096547097 SHLPH 300,000 R&L

12/ 6/16 Tuesday, 6 December 2016 SCM 9492 CLG095679479 SHLPH 500,000 R&L

12/ 8/16 Thursday, 8 December 2016 SCM 9496 CLG096587912 SHLPH 800,000 R&L

12/13/16 2016 Tuesday, 13 December SCM 9499 CLG096599482 SHLPH 700,000 R&L

12/29/16 Thursday. December 2016 29 SCM 95 97 CLG96653656 SHLPH 200,000 R&L

1/20/17 Friday, 2017 20 January SCM 9630 CLG096714452 SHLPH 100,000 R&L

Page 13 of 27

2/13/17 Monday, 13 February 2017 SCM 9664 CLG96783917 SHLPH 200,000 R&L 6/ 6/17 Tuesday, 6 June 2017 SCM 9960 CLG097180217 SHLPH 100,000 R&L

6/21/17 Wednesday, 21 June 2017 SCM 9971 CLG97232380 DD 100,000 RL

6/21/17 Wednesday, 21 June 2017 SCM 99 1 CLG97232378 AT 500,000 RL 8/11/17 8/17/17 Friday, 11 August 2017 Thursday, 17 August 2017 SCM SCM 10137 10141 CLG093794754 CLG097411016 CHIB CHIB 100,000 100,000 RL R&

8/23/17 Wednesday, 23 August 2017 SCM 10147 CLG097423880 CHIB 300,000 R&L

8/30/17 Wednesday, 30 August 2017 SCM 10154 A CLG097442927 NIKL 1,000,000 R&L

9/13/17 Wednesday. September 2017 13 SCM 10160 CLG097479573 PPC 500,000 R&L

9/29/17 Friday, 29 September 2017 SCM 10196 CLG97543862 DD 100,000 R&L

10/ 4/17 Wednesday, 4 October 2017 SCM 10202 CLG097556805 NIKL 500,000 R&L

10/11/17 Wednesday. October 2017 11 SCM 10213 CLG097579093 CHIB 200,000 RL

10/18/17 Wednesday, October 2017 18 SCM 10227 CLG 97598968 CHIB 300,000 R&L

11/ 2/17 Thursday, 2 November. 2017 SCM 10232 CLG97644751 AC 7,000 R&L

11/14/17 Tuesday, 14 November 2017 SCM 10256 CLG97680604 AC 7,000 R&L

11/24/17 Friday, 24 November 2017 SCM 10262 CLG97716704 AC 2,000 R&

11/24/17 Friday, 24 November 2017 SCM 10262 CLG97716703 CHIB 200,000 R

12/ 4/17 Monday, 4 December 2017 S CM 10265 CLG097737974 GTPPA 7,00 R&L

12/6/17 Wednesday. December 2017 6 SCM 10266 CLG097751816 8990P 80,000 R&L

12/13/17 Wednesday, December 2017 13 SCM 10268 CLG097776108 MPI 500,000 R&L

12/19/17 Tuesday, 19 December 2017 SCM 10277 CLG09798011 MER 30,000 R&L

12/20/17 Wednesday, December 2017 20 SCM 10278 CLG097804305 SMC 40,000 R&L

12/20/17 Wednesday. December 2017 20 SCM 10278 CLG097804304 DL 400,000 R&L

12/22/17 Friday, 22 December 2017 SCM 10300 CLG097814364 MWIDE 200,000 R&L

12/22/17 Friday, 22 December 2017 SCM 10300 CLG097814363 CLC 500,000 R&L

12/22/17 Friday, 22 December 2017 SCM 10300 CLG097814365 DD 100,000 R&L

12/22/17 Friday, 22 December 2017 SCM 10300 CLG097814411 NIKL 500,000 R&L

12/22/17 Friday, 22 December 2017 SCM 10300 CLG097814630 TEL 4,000 R&L

Page 14 of 27

12/22/17 Friday, 22 December 2017 SCM 10300 CLG097814976 PX 1,000,000 R&

12/29/17 Friday, 29 December 2017 SC M 10308 CLG097828973 SMC 30,000 RL

1/12/18 Friday, 2018 12 January SCM 10320 CL097867979 CHIB 500,000 R&L

1/26/18 Friday. 20 18 26 January SCM 10338 CLG0000097918626 CHIB 500,000 R

2/27/18 Tuesday, 27 Fehruary 2018 SCM 10364 CLG0000098022794 CHIB 200,000 R&L

3/ 7/18 Wednesday, 7 March 2018 SCM 10379 CLG098057820 EW 100,000 R&

3/7/18 Wednesday, 7 March 20 18 SCM 10379 CLG098057819 FGEN 150,000 R&L

3/ 7/18 Wednesday, 7 March 2018 SCM 10379 CLG098057821 MBT 50,000 R&L

3/7/18 Wednesday, 7 March 2018 SCM 10379 CLG098057818 PXP 300,000 R&L

3/20/18 Tuesday, 2018 20 March SCM 10382 CLG098095124 APC 5,000,000 R&L

3/20/18 2018 Tuesday, 20 March SCM 10382 CLG098095125 BLOOM 300,000 R&L

3/20/18 Tuesday, 2018 20 March SCM 10382 CLG098095126 BPI 50,000 R&L

3/20/18 Tuesday, 20 March 2018 SCM 10382 CLG098095128 GTCAP 2,000 R&L

3/27/18 Tuesday, 2018 27 March SCM 10393 CLG098127312 CHIB 100,000 R&L

3/27/18 2018 Tuesday. 2? March SCM 10393 CLG098127313 MBT 60,000 R&L

4/ 3/18 Tuesday, 3 April 2018 SCM 10394 98139006 FROM R & L AEV 40,000 R&L

4/ 3/18 Tuesday, 3 April 2018 SCM 10394 98139159 FROM R & DMC 300,000 R&L

4/ 3/18 Tuesday, 3 April 2018 SCM 10394 98139002 FROM R & EAGLE 200,000 R&L 4/17/18 Tuesday, 17 April 2018 SCM 10436 CLG098181661 BPY 50,000 R&L

4/18/18 Wednesday, 18 April 2018 SCM 10438 98184504 FROM R & L CHIB 100,000 R&L

4/18/18 Wednesday, 18 April 2018 SCM 10437 CLG098184499 OPM 200,000,000 R&L

4/18/18 Wednesday, 18 April 2018 SCM 10437 CLG098184503 PCOR 300,000 R&L

4/18/18 Wednesday, 18 April 2018 SCM 10437 CLG098184507 PRF2A 3,000 R&L

4/26/18 Thursday. 2018 26 April SCM 10445 CLG098212986 AUB 50,000 R&L

4/26/18 Thursday. 2018 26 April SCM 10445 CLG098212988 BDO 20,000 R&

4/26/18 Thursday, 2018 26April SCM 10445 CLG098211323 BEL 700,000 RL 4/27/18 Friday, 27 April 2018 SCM 10446 CLG098215991 ALCPB 20,000 R&L 4/27/18 Friday, 27 April 2018 SCM 10446 CLG098215989 COSCo 200,000 R&L 4/27/18 Friday, 27 April 2018 SCM 10446 CLG098215990 PNX3A 25,000 R&L

Page 15 of 27

4/27/18 Friday, 27 April 2018 SCM 10446 CLG098215992 PNX3B 10,000 J R&L

5/ 8/18 5/8/18 Tuesday, 8 May 2018 Tuesday, 8 May 2018 S CM SCM 10466 10466 CLG098242243 CLG098242247 PNB PHEN 1,500,000 20,000 R&L R&L 5/8/18 Tuesday, 8 May 2018 SCM 10466 CLG098242244 SHNG 1,000,000 R&L

5/10/18 5/8/18 Thursday, 20 18 Tuesday, 8 May 2018 10 May SCM SCM 10466 10468 CLG098242246 CLG098250551 URC BP 30,000 15,000 R&L R&L

5/10/18 Thursday. 2018 10 May SCM 10468 CLG098250550 EW 100,000 R&L 5/25/18 5/25/18 Friday, 25 May 2018 Friday, 25 May 2018 SCM SCM 10475 10475 CLG098294567 CLG098294565 CYBR GTPPB 4,000,000 3,000 R&L RL 5/25/18 Friday, 25 May 2018 SCM 10475 CLG098294566 MPI 300,000 RL 5/31/18 Thursday, 31 2018 May SCM 10477 CLG098310878 B PI 20,000 R&

5/31/18 Thursday, 2018 31 1May SCM 10477 CLG098310878 SM 1,800 R&L

6/ 4/18 Monday, 4 June 2018 SCM 10479 CLG98320988 FROM R & L INVESTMENT AL 35,000 R&L 6/11/18 Monday, 11 June 2018 SCM 10543 CLG098348080 AC 1,500 R&L 6/11/18 Monday, 11 June 2018 SCM 10543 CLG098348079 ACPB 4,000 R&L 6/11/18 Monday, 11 June 2018 SCM 10543 CLG098348075 BSC 5,000,000 R&L 6/11/18 Monday, 11 June 2018 SCM 10543 CLG098348077 DMC 100,000 RL 6/11/18 Monday, 11 June 2018 SCM 10543 CLG093848186 RWM 250,000 R&L

7/10/18 6/26/18 Tuesday, 26 June 2018 Tuesday, 10 July 2018 SCM SCM 10570 10552 CLG098392390 CLG098439045 FBP2 MBT 70,000 2,000 RL R&L

7/27/18 Friday, 27 July 2018 SCM 10581 CLG9841878 FROM R&L OV 90,100,000 R&L

7/27/18 Friday, 27 July 2018 SCM 10581 CLG98481863 FROM R&L PPC 120,000 R&L

7/27/18 Friday, 27 July 2018 SCM 10581 CLG9841862 FROM R&L TUGS 200,000 R&L

7/27/18 Friday, 27 July 2018 SCM 10581 CLG98481879 FROM R WLCON 100,000 R&L

8/ 2/18 Thursday, 2 August 2018 SCM 10587 CLG98498879 ACR 700,000 R&L

8/ 2/18 2018 Thursday, 2 August SCM 10587 CLG98498882 AGI 80,000 R&L

8/ 2/18 Thursday, 2 August 2018 SCM 10587 CLG98498881 CLC 170,000 R

8/ 2/18 Thursday, 2 August 2018 SCM 10587 CLG98498883 CNP 50,000 R&L

8/ 2/18 Thursday, 2018 2 August SCM 105 87 CLG98498884 MWP 10,000 R&L

8/ 2/18 Thursday, 2 August 2018 SCM 10587 CLG98498880 PX 200,000 R&L

8/ 6/18 Monday. 2018 6 August SCM 10593 CLG98509911 TFH 4,00 R&L

8/ 7/18 Tuesday. 2018 August SCM 10594 CLG098511904 LG 50,000 R&L

8/ 9/18 Thursday, 9 August 2018 SCM 10601 CLG098533170 M BT 17,000 R&L

Page 16 of 27

8/16/18 Thursday, 16 August 2018 SCM 10602 CLG098537816 CHP 200,000 R&L

8/16/18 Thursday, 16 August 2018 SCM 10602 CLG098537820 G SM 30,000 R&L

8/16/18 Thursday, 16 August 2018 SCM 10602 CLG098537831 MAXS 100,000 R&L

8/16/18 Thursday, 16 August 2018 SCM 10602 CLG098537815 MRSGI 300,000 R&L

8/16/18 Thursday, 16 August 2018 SCM 10602 CLG098537817 PBB 100,000 R&L

8/16/18 Thursday, 16 August 2018 SCM 10602 CLG098537818 SCC 30,000 R&L

8/24/18 Friday,24 August 2018 SCM 10820 CLG098556767 8990P 9,000 R&L 8/24/18 Friday, 24 August 2018 SCM 10820 CLG098556766 AP 15,000 R& 8/24/18 Friday, 24 August 2018 ISCM 10820 CLG098556765 CPM 400,000 R&L

8/30/18 Thursday, 30 August 2018 SCM 10887 CLG98568947 FR0M R& L CHIB 40,000 R&L

8/30/18 Thursday, 30 August 2018 SCM 10887 CLG98569089 FR0M R&L PAX 700,000 R&L

8/30/18 Thursday, 30 August 2018 SCM 10887 R&L CLG98568986 FROM PSB 14,000 RL

8/30/18 Thursday, 30 August 2018 SCM 10887 CLG98569090 FROM R&L PXP 100,000 R&L

8/31/18 Friday, 31 August 2018 SCM 10889 CLG98572615 FROM R&L AT 300,000 R&L

8/31/18 Friday, 31 August 2018 SCM 10889 CLG98572616 FROM R& L NIKL 200,000 R&L

9/ 6/18 Thursday, 6 September 2018 SCM 10893 CLG098590326 BDO 100,000 R

9/19/18 Wednesday, September 2018 19 SCM 108 9 CLG98626811 FROM R&L FL 400,000 R&L

9/19/18 Wednesday, September 2018 19 SCM 10899 CLG98626809 FROM R&L FPH 10,000 R&L

9/19/18 September 2018 Wednesday. 19 SCM 10899 CLG98626807 FROM R&L MWC 25,000 R&L

9/19/18 Wednesday. September 2018 19 SCM 10899 CLG98626806 TO R&L PCOR 50,000 R

9/19/18 September 2018 Wednesday. 19 SCM 10899 CLG98626808 FROM RL PGOLD 15,000 R&L

9/19/18 Wednesday, September 2018 1 SCM 10899 CLG98626810 FROM R&L SM 1,000 R&

9/28/18 Friday, 28 September 2018 SCM 10910 CLG98657387 FROM R&L SHLPH 5,000 R&L

9/28/18 Friday, 28 September 2018 SCM 10910 CLG98657389 SM 2,000 R&L

10/ 5/18 Friday, 5 October 2018 SCM 10918 RL CLG98678907 FROM ABA 1,500,000 RL

10/5/18 Friday, 5 October 2018 SCM 10918 CLG98678910 FR0M R&L BDO 5,000 R&L

10/ 5/18 Friday, 5 October 2018 SCM 10918 CLG98678911 FROM R&L B PL 5,000 R&L

10/ 5/18 Friday, 5 October 2018 SCM 10918 R&L CLG98678908 FROM FNI 250,000 R&L

10/ 5/18 Friday, 5 0ctober 2018 SCM 10918 R&L CLG98678909 FROM MEG 100,000 RL

Page 17 of 27

10/12/18 Friday, 2018 12 October SCM 10921 CLG98695758 FROM R&L DNL 70,000 R&L

10/12/18 Friday. 2018 12 October SCM 10921 CLG98695760 FROM R&L FBP2 500 RL

10/12/18 Friday, 2018 12 October SCM 10921 CLG98695759 FROM R&L MBT 10,000 R&L

10/25/18 Thursday, 25 October 2018 SCM 10932 CLG98731026 FROM R&L COSCO 70,000 R&

10/25/18 Thursday, 25 October 2018 SCM 10 932 CLG98731025 FROM R&L MP 100,000 R&L

10/25/18 11/ 8/18 Thursday, 8 November Thursday, 25 October 2018 2018 SCM SCM 10932 10934 CLG98731024 FROM R&L CLG98760856 FROM R&L MRC M BT 1,500,000 20,000 R&L R&L

11/ 9/18 Friday, 9 November 2018 SCM 10936 CLG98768007 FROM R&L PN B 30,000 R&L

11/15/18 Thursday, November 2018 15 SCM 10939 CLG98783650 EE 60,000 R&

11/15/18 Thursday, November 2018 15 SCM 10939 CLG98783653 GSMI 15,000 R&L

11/15/18 Thursday. November 2018 15 SCM 10939 CLG98783654 ICT 7000 R&L

11/15/18 Thursday, November 2018 15 SCM 10939 CLG98783651 MWIDE 60,000 R&L

11/15/18 November 2018 Thursday, 15 SCM 10939 CLG98783652 PBB 40,000 R&L

11/15/18 November 2018 Thursday. 15 SCM 10939 CLG98783656 SLF 1,000 R&L

11/15/18 Thursday, November 2018 15 SCM 10939 CLG98783649 SS 300,000 R&L

11/15/18 November 2018 Thursday. 15 SCM 10939 CLG98783655 URC 4,000 RL

11/15/18 November 2018 Thursday. 15 SCM 10939 CLG98783648 N 400,000 R&L

11/23/18 11/23/18 11/23/18 Friday, 23 November Friday, 23 November Friday, 23 November 2018 2018 2018 SCM SCM SCM 10970 10970 10970 R&L INVESTMENT R&L INVESTMENT CLG98810758 FROM CLG98810760 FROM R&L INVESTMENT CLG98810755 FROM CNPF AUB CLC 100,000 30,000 20,000 R R&L R

11/23/18 11/23/18 11/23/18 Friday, 23 November Friday, 23 November 2018 2018 Friday, 23 November 2018 SCM SCM SCM 10970 10970 10970 R&L INVESTMENT CLG98810757 FR0M R&L INVESTMENT CLG98810754 FROM R&L INVESTMENT CLG98810759 FROM RLC S EW 150,000 50,000 25,000 R& R&L R&L

11/23/18 Friday, 23 November 2018 SCM 10970 R&L INVESTMENT CLG98810756 FR0M VLL 70,000 RL

11/29/18 Thursday. November 2018 2 SCM 10973 CLG098826503 SMC 30,000 R&

12/ 7/18 2018 Friday, ? Decermber SCM 10978 CLG098856485 ACPB2 0 R&L

12/ 7/18 Friday, 7 2018 December SCM 10978 CLG098856483 DD 40000 R&L

12/ 7/18 2018 Friday, 7 December SCM 10978 CLG098856481 NIKL 300,000 RL

Page 18 of 27

12/ 7/18 Friday. 7December 2018 SCM 10978 CLG098856479 OPM 50,000,000 R&L

12/ 7/18 Friday, 7 2018 December SCM 10978 CLG098856480 OPMB 50,000,000 R&

12/7/18 2018 Friday. 7 December SCM 10978 CLG098857364 PAL 50,000 R&L

12/ 7/18 Friday,7 2018 December SCM 10978 CLG098857365 SLF 350 R&L

12/ 7/18 Friday, 7 December 2018 SCM 10978 CLG098857363 SOC 1,000,000 R&L

12/7/18 Friday. 7 December 2018 SCM 10978 CLG098856482 TUGS 120,000 R&L

12/11/18 Tuesday, 11 December 2018 SCM 10981 CLG98868579 AC 400 R&L

12/11/18 Tuesday, 11 December 2018 SCM 10981 CLG98868578 ALCPB 4,00 R&L

12/11/18 Tuesday, 11 December 2018 SCM 10981 CLG98868577 CEB 5,000 R&L

12/11/18 Tuesday, 11 December 2018 SCM 10981 CLG98868573 LC 5,020,000 RL

12/11/18 Tuesday, 11 December 20 18 SCM 10981 CLG98868575 MAC 30,000 R&L

12/11/18 Tuesday, 11 December 2018 SCM 10981 CLG98868576 SHLPH 10,000 R&L

12/12/18 Wednesday, December 2018 12 SCM 10983 CLG098873690 CHIB 400,000 R

12/19/18 Wednesday. December 2018 19 SCM 10994 CLG98897711 CHIB 150,000 R&L

1/ 3/19 Thursday. 2019 3 January SCM 11004 CLG098927854 PX 300,000 R&L

1/ 3/19 Thursday, 3 January 2019 SCM 11004 CLG098927868 ALCO 500,000 R&L

1/ 3/19 Thursday. 3 January 2019 SCM 11004 CLG098927850 NI 300,000 R&L

1/ 3/19 Thursday, 3 January 2019 SCM 11004 CLG098927889 GEO 2,000,000 R&L

1/ 3/19 Thursday, 3 January 2019 SCM 11004 CLG098927851 BLOOM 60,000 R&L

1/3/19 Thursday, 3 January 2019 SCM 11004 CLG098927852 AGI 40,000 R&L

1/ 3/19 Thursday, 3 January 2019 S CM 11004 CLG098927853 PRF2A 500 R

1/3/19 Thursday, 3 January 2019 SCM 11006 CLG98930648 BC 1,000,000 R&L

1/ 7/19 2019 Monday, January SCM 11007 CLG098936703 PNB 10,000 R&L

1/ 7/19 Monday, 2019 7 January SCM 11007 CLG098936704 JC 3,000 R&L

1/10/19 Thursday, 10 January 2019 SCM 11010 CLG98949537 LC 4,000,000 R&L

1/10/19 Thursday, 10 January 2019 SCM 11010 CLG98949538 LPZ 100,000 R&L

1/10/19 Thursday, 10 January 2019 SCM 11010 CLG98949539 PXP 60,000 R&

1/10/19 Thursday, 10 January 2019 SCM 11010 CLG98949451 SECB 3,000 R&L

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1/10/19 Thursday, 10 January 2019 SCM 11010 CLG98949540 BDO 5,000R&L

1/11/19 Friday. 20 19 11 January SCM 11012 CLG98954421 ISM 100,000 R&L

1/11/19 Friday, 2019 11 January SCM 11012 CLG98954420 VUL 150,000 R&L

1/11/19 Friday,11 2019 January SCM 11012 CLG98954419 IRC 200,000 R&L

1/18/19 Friday. 2019 18 January SCM 11014 CLG098981007 CHIB 15,000 R&L

1/18/19 2019 Friday. 18 January SCM 11014 CLG098981006 ABS 15,000 R&L

1/18/19 2019 Friday, 18 January SCM 11014 CLG098981003 RLT 1,000,000 R&L

1/22/19 Tuesday, 22 January 2019 SCM 11018 CLG098989857 AEV 6,000 R&L

1/29/19 Tuesday, 29 January 2019 SCM 11019 CLG99013847 LMG 100,000 R&L

1/29/19 Tuesday, 29 January 2019 SCM 11019 CLG99013849 GLO 200 R&L

1/29/19 Tuesday, 29 January 2019 SCM 11019 CLG99013845 APC 700,000 R&L

1/29/19 Tuesday, 29 January 2019 SCM 11019 CLG99013846 BRN 400,000 R&L

1/29/19 Tuesday, 29 January 2019 SCM 11019 CLG099013860 PSB 5,820 R&L

3/ 7/19 2019 Thursday. I March SCM 11029 CGL99138274 PCOR 50,000 R&L

3 / 7/19 Thursd ay. 2019 March SCM 11029 CLG99138273 SBS 60,000 R&L

3/ 7/19 Thursday. 2019 1 March SCM 11029 CLG99138272 MA 100,000,000 R&L

3 / 7/19 Thursday, 2019 7 March SCM 11029 CLG99138271 UPM 100,000,000 R&L

3/ 7/19 Thursday,7 2019 March SCM 11029 CLG99138270 MAB 150,000,000 R&L 3/ 8/19 Friday, 8 March 2019 SCM 11030 CLG99141582 GTPPB 400 R&L

3/ 8/19 3/ 8/19 3/8/19 Friday, 8 March 2019 Friday, 8 March 2019 Friday, 8 March 2019 SCM SCM SCM 11030 11030 11030 CLG99141581 CLG99141580 CLG99141583 OPMB GTPPA SM 25,000,000 420 400 RL R&L RL

3/15/19 Friday, 15 March 2019 SCM 11033 CLG99162384 RWM 60,000 R&L 3/15/19 3/15/19 Friday, 15 March 2019 Friday, 15 March 2019 SCM SCM 11033 11033 CLG99162382 CLG99162383 PHEN E 280,000 60,000 R&L RL

3/15/19 Friday, 15 March 2019 SCM 11033 CLG99162381 BHE 6,000,000 R&L

3/15/19 3/15/19 Friday, 15 March 2019 Friday, 15 March 2019 SCM SCM 11033 11033 CLG 99162386 CLG 99162385 IGS GTCAP 6000 000 R&L R&L 3/22/19 Friday, 22 March 2019 SCM 11040 CLG0999182458 ACR 200,000 R&L 3/22/19 3/22/19 Friday, 22 March 2019 Friday, 22 March 2019 SCM SCM 11040 11040 CLG099918240 CLG099182441 EL IM 600,000 120,000 R&L R&L

3/22/19 3/22/19 Friday, 22 March 2019 Friday, 22 March 2019 SCM SCM 11040 11040 CLG0999182442 CLG0999182457 ZH CL 1,500,000 80,000 R&L R&L

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3/22/19 3/22/19 3/22/19 3/26/19 Friday, 22 March 2019 Friday, 22 March 2019 Tuesday, 26 March 2019 Friday, 22 March 2019 SCM SCM SCM SCM 11040 11040 11040 11041 CLG0999182443 CLG99190537 CLG0999182459 CLG0999182460 ACPB AP COL MPI 100,000 15,000 9,000 600 R&L R& R&L R&&L

4/ 4/19 4/ 4/19 Thursday, 4 April 2019 Thursday, 4 April 2019 SCM SCM 11083 11083 CLG99219596 CLG99219592 SMC2D LC 2,800,000 5000 R&L R&L

4/ 4/19 4/ 4/19 Thursday, 4 April 2019 Thursday, 4 Aprii 2019 SCM SCM 11083 11083 CLG99219593 CLG9920647 PHA CHIB 500,000 60000 R R&L

4/ 5/19 4/ 4/19 4/5/19 Thursday, 4 April 2019 Friday, 5 April 2019 Friday, 5 April 2019 SCM SCM SCM 11084 11084 11083 CLG099222491 CLG99219595 CLG099222492 ANI SMPH CHP 130,000 18,000 7000 R&L R&L R&L

4/15/19) 4/15/19 4/ 5/19 4/ 5/19 4/ 5/19 4/15/19 Monday, 15 April 2019 Monday, 15 April 2019 Monday, 15 April 2019 Friday, 5 April 2019 Friday, 5 April 2019 Friday, 5 April 2019 SCM SCM SCM SCM SCM SC M 11087 11084 11087 11084 11087 11084 CLG099222488 CLG099222489 CLG099243699 CLG099243697 CLG099243698 CLG099222490 ST APO PX MVC APX PNB 500,000 150,000 150,000 400,000 180,000 12,000 RL R&L R&L R&L R&L R&L

4/16/19 4/16/19 Tuesday, 16 April 2019 Tuesday, 16 April 2019 SCM SCM 11088 11088 CLG099247884 CLG099247887 SOC GMAP 300,000 60,000 R&L RL 4/16/19 Tuesday, 16 April 2019 SCM 11088 CLG099247886 NIRL 100,000 R&L 4/16/19 4/23/19 Tuesday, 23 April 2019 Tuesday, 16 April 2019 SCM SCM 11090 11088 CLG099259934 CLG099247885 SHLPH IRC 200,000 7000 RL R&L 4/23/19 Tuesday, 23 April 2019 SCM 11090 CLG099259930 OM 450,000 R&L

4/23/19 4/23 /19 4/23/19 4/23/19 4/23/19 4/23/19 4/25/19 Tuesday, 23 April 2019 2019 Tuesday, 23 April 2019 Tuesday, 23 April 2019 Tuesday, 23 April 2019 Tuesday, 23 April 2019 Tuesday, 23 April 2019 Thursday. 25 April SCM SCM SCM SCM SCM SCM SCM 11092 11090 110 90 11090 11090 11090 11090 CLG099259948 CLG099267890 CLG099259937 CLG099259931 CLG099259935 CLG099259936 CLG099259932 FBP2 FB SHNG GTPPA PRIM FGEN TEL 180,000 80,000 10,000 2,400 3 50 300 350 R&L R&L R&L R&L R&L R&L R&L

4/25/19 Thursday. 2019 25 April SCM 11092 CLG099267889 MAXS 20,000 R&L

4/25/19 Thursday, 25 April 2019 SCM 11092 CLG099267888 HLCM 25,000 R&L

5/ 3/19 5/3/19 5/3/19 5/3/19 5/ 3/19 Friday, 3 May 2019 Friday, 3 May 2019 Friday, 3 May 2019 Friday, 3 May 2019 Friday, 3 May 2019 SCM SCM SCM SCM SCM 11100 11100 11100 11100 11100 CLG099288138 CLG099288135 CLG099288140 CLG099288236 CLG099288141 SMC AUB PAX MRSGI CPG 250,000 450,000 85,000 3,00 2,5 00 R&L RL R&L R&L R&L

5/ 3/19 Friday, 3 May 2019 SCM 11100 CLG099288237 BC 200,000 R&L

5/20/19 5//19 5/3/19 Monday, 20 May 2019 Friday, 3 May 2019 Tuesday, 7 May 2019 SCM SCM SCM 11107 11100 11101 CLG099297289 CLG099288238 CLG99309574 AL P[ZZA AL 350,000 17,000 15,000 R R&L R&L

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5/23/19 Thursday. 2019 23 May SCM 11114 CLG099355765 GTCAP 500 R&L

5/23/19 Thursday, 2019 23 May SCM 11115 CLG099355764 LTG 12,000 R&L

5/23/19 Thursday. 2019 23 May SCM 11116 CLG099355763 WPI 300,000 R&L

5/23/19 Thursday. 2019 23 M ay SCM 11117 CLG099355762 COAL 650,000 R&

5/30/19 Thursday. 2019 30May SCM 11119 CLG PCOR 50,000 R&L

6/ 3/19 Monday, 3 June 2019 SCM 11126 CLG099391981 PSB 980 R&L 6/ 3/19 Monday, 3 June 2019 SCM 11126 CLG099391980 JFC 1,000 R&L 6/ 3/19 Monday, 3 June 2019 SCM 11126 CLG099391979 PNB 10,000 R&L 6/ 3/19 Monday, 3 June 2019 SCM 11126 CLG099391978 BPI 20,000 R& 6/ 3/19 Monday, 3 June 2019 SCM 11126 CLG099391977 RFM 50,000 R&L

6/19/19 Wednesday, 19 June 2019 SCM 11139 CLG99442233 RC 1,100,000 R&L

6/19/19 Wednesday, 19 June 2019 SCM 11139 CLG99442234 SMC 8,00 R&L

6/19/19 Wednesday, 19 June 2019 SCM 11139 CLG99442235 BPI 6,00 R& 6/25/19 Tuesday, 25 June 2019 SCM 11145 CLG099457033 PNB 80,000 R&L

6/27/19 Thursday. 2019 27 June SCM 11146 CLG099468110 GREEN 200,000 R&L

6/28/19 Friday, 28 June 2019 SCM 11147 CLG 099470469 PRF3A 2,000 R&L 7/ 2/19 Tuesday, 2 July 2019 SCM 11149 CLG099479096 ALCPC 20,000 RL 7/16/19 Tuesday, 16 July 2019 SCM 11151 CLG99523860 RC 1,500,000 R&L

7/31/19 Wednesday, 31 July 2019 SCM 11160 CLG099570566 JFC 2,000 R&L

7/31/19 Wednesday, 31 July 2019 SCM 11160 CLG099570564 PNB 20,000 RL

7/31/19 Wed nesday. 2019 31 July SCM 11160 CLG099570565 DD 15,000 R&L

8/ 6/19 Tuesday, 2019 6 August SCM 11175 CLG099587589 SL 100,000 R&L

8/ 6/19 Tuesday, 2019 6 August SCM 11175 CLG099587547 JFC 2,000 R&L

8/ 6/19 Tuesday. 2019 6 August SCM 11175 CLG099587546 CE 1,000,000 R&L

8/ 6/19 2019 Tuesday. 6 August SCM 11175 CLG099587590 X 150,000 R&L

8/ 6/19 2019 Tuesday, 1 August SCM 11175 CLG099587591 STR 11,600 R&L

8/6/19 Tuesday, 6 August 2019 SCM 11175 CLG099587588 NRCP 180,000 RL

8/ 7/19 2019 Wednesday, 7 August SCM 11176 CLG099591631 CHP 100,000 R&L

8/ 7/19 Wednesday, 7 August 2019 SCM 11176 CLG099591633 MP 65,000 R&L

8/ 7/19 Wednesday, 7 August 2019 SCM 11176 CLG099591632 NIKL 90,000 R&L

8/13/19 Tuesday, 13 August 2019 SCM 11178 CLG99606370 BDO 15,00 R&L

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9/12/19 Thursday, September 2019 12 SCM 11202 CLG99699878 IFC 3,000 R

9/12/19 September 2019 Th ursday. 12 SCM 11202 CLG99699886 PNB 10,000 RL

9/17/19 Tuesday, September 2019 17 SCM 11203 CLG99710907 RCI 300,000 R&L

9/18/19 Wednesday, September 2019 18 SCM 11204 CLG99714767 ANS 20,000 R&L

9/18/19 Wednesday, September 2019 18 SCM 11204 CLG99714766 RWM 25,700 R&L

9/18/19 Wednesday. September 2019 18 SCM 11204 CLG99714768 BDO 3,000 R&L

9/20/19 Friday, 20 September 2019 SCM 11205 CLG996722761 BEC 700,000 R&L

9/20/19 Friday, 20 Septemher 2019 SCM 11205 CLG99722762 SMC 4,000 R&L

10/ 9/19 Wednesday, 9 October 2019 SCM 11239 CLG99774482 PX 700,000 R&L

10/14/19 Monday, 14 October 2019 SCM 11268 CLG99785553 AXLM 500,000 RL

10/15/19 Tuesday. 2019 15 October SCM 11269 CLG99788560 HOME 100,000 R&L

10/18/19 2019 Friday, 18 October SCM 11273 CLG099798550 HOME 100,000 RL

10/22/19 Tuesday, 22 October 2019 SCM 11276 CLG99806853 PPG 30,000 R&L

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831061 PCOR 40,000 R&L

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831062 PGOLD 7,000 R&L

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831054 AG 15,000 RL

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831060 PX 90,000 R&L

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831056 PAL 6200 R&

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831089 MEG 60,000 R

10/31/19 Thursday, 31 October 2019 SCM 11353 CLG99831055 JIC 900 R&L

10/31/19 Thursday, 31 October 2019 SC M 11353 CLG99831057 ICT 2,000 R&

10/31/19 2019 Thur'sday, 31 October SCM 11353 CLG99831059 TB GI 1,300,000 R&L

are impressed with public interest, and are thus subject to public regulation. In the case of Securities and Exchange Commission v. Honorable Court of Appeals et al., 3, the Honorable intentional wrongful acts which resulted to the prejudice and damage of R&L's investors in the present case. It is worthy to mention that transactions involving securities Supreme Court held: Thus, the Respondent should not get away from the consequences of his

The rise and fall of stock market indices reflect to a considerable degree the state of "Stock market transactions affect the general public and the national economy.

3 G.R. Nos. 106425 & 106431-32, (July 21, 1995)

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subject to public regulation. In particular, the laws and regulations requiring payment of traded shares within specified periods are meant to protect the economy from excessive stock m arket speculations, and are thus mandatory." (Underscoring supplied} the economy. Trends in stock prices tend to herald changes in business conditions. Consequently, securities transactions are impressed with public interest and are thus

Counter-Affidavit are facts sufficient to support a conclusion that the Respondent violated SRC Section 26 paragraphs 1 and 3 in relation to SRC Rule 26.1. Here, the evidence presented by complainant and the statement of Respondent in his

52.1.7.5.2 28 of the SRC in relation to SRC Rule Respondent Marlo Moron violated Section

Section 28 of the SRC provides:

Sec. 28. Registration of Brokers, Dealers, Salesmen and Associated Persons. - 28.1. No person shall engage in the business of buying or selling securities in the Philippines as a broker or dealer, or act as a salesman, or an associated person of any broker or dealer unless registered as such with the Commission.

On the other hand, Rule 52.1.7.5.2 of the 2015 SRC Rules provides:

Rule 52.1.7.5.2. The designation should be entered on real time on the order ticket and indicated on the confirmation.

such offer or sale of the security. [Emphasis ours.] act of seeking or asking for business or information and including the act of providing information about a security or investment product being offered for sale with the view of making another person a client or closing or bringing in a sale or purchase of security or investment product. The solicitor need not be a signatory to any contract relative to No person shall solicit investments in securities and other investment products unless he is a registered broker or dealer or licensed salesman of a broker dealer. Solicitation is the

trade transactions involving large number and amount of securities. the Commission authorizing him to act as salesman in securities. Yet he executed trades at the PSE despite not having a license as a trader or salesman. He also executed numerous EQ As shown in the above discussion, the Respondent admitted that has no license from

Moron is not registered as a salesman of securities. In addition, upon verification of the records of the Commission shows that Respondent

PENALTIES TO BE IMPOSED

other alternative penalties as provided for under Sec. 54.1 of the SRC. (MC 6, s. 2005 or Circular), the Commission, in its discretion, has the power to impose Notwithstanding the provision of SEC Memorandum Circular No. 6, series of 2005

The pertinent portion of Sec. 54.1 of the SRC is herein reproduced:

light of the facts and circumstances: Sec. 54.1 - If after due notice and hearing, the Commission finds that: (a) there is a violation of this Code,its rules or its orders (b) xxxxxxxxx (c} xxxxxxxxx (d) xxx xxxxxx, it shall, in its discretion, and subject only to the limitations hereinafter prescribed, impose any or all of the following sanctions as may be appropriate in

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(i) Suspension, or revocation of any registration for the offering of securities;

day of continuing violation; (ii) A fine of no less than Ten Thousand pesos (P10,000.00) nor more than One Million Pesos (P1,000,000.00) plus not more than Two Thousand Pesos (P2,000.00) for each

act, rule or regulation administered by the Commission: functions, of an issuer required to file reports under Section 17 of this Code or any other (iii) In the case of a violation of Sections 19.2, 20, 24, 26 and 27, disqualification from being an officer, member of the Board of Directors, or persons performing similar

proscribed by such Section; and (iv) In the case of a violation of Section 34, a fine of no more than three (3) times the profit gained or loss avoided as a result of the purchase, sale or communication

(v) Other penalties within the power of the Commission to impose. (emphasis supplied)

provision of law, thus: of the SRC, the Commission adopted SRC Rule 54.1 which mirrors the above-mentioned Hence, in the implementation of the foregoing and in order to give effect to the intent

of the facts and circumstances: Sec. 54.1 - If after due notice and hearing, the Commission finds that: (a) there is a violation of this Code, its rules, or its orders (b) xxx xxxxxx, it shall in its discretion, and subject only to the limitations hereinafter prescribed, impose any or all of the following sanctions as may be appropriate in light XXXXXX (c) xXXXXXXXX (d) XXX

54.1.1 Suspension, or revocation of any registration for the offering of securities;

Million Pesos (P1,000,000.00) plus not more than Two Thousand Pesos (P2,000.00) for each day of continuing violation; 54.2.2. A fine of no less than Ten Thousand pesos (P10,000.00) nor more than One

act, rule or regulation administered by the Commission; being an officer, member of the Board of Directors, or persons performing similar functions, of an issuer required to file reports under Section 17 of this Code or any other 54.1.3. In the case of a violation of Sections 19.2, 20, 24, 26 and 27, disqualification from

profit gained or loss avoided as a result of the purchase, sale or communication 54.1.4. In the case of a violation of Section 34, a fine of no more than three (3) times the proscribed by such Section; and

54.1.5. Other penalties within the power of the Commission to impose. (emphasis supplied

apply in every case and the SEC is empowered to select the sanction appropriate to the facts and circumstances of each situation. flexibility based on its discretion to impose various kinds of sanctions since not all sanctions On the basis of the above-quoted provisions, it is clear that the Code gives the SEC

Php1,000,000.00. of the SRC and its IRR. If fine alone is the penalty to be imposed, the maximum shall be against a Company and any person found administratively liable for violating any provision The Commission may thus impose any of the above-mentioned alternative penalties

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hereinafter prescribed, impose any or all of the following sanctions as may be appropriate in light of the facts and circumstances " operates to confer discretion to SEc to select the sanction appropriate to the facts and circumstances of each case. Applying Section 54.1, therefore, it does not prohibit the Commission to impose sanction based on its discretion. To emphasize, the phrase "in its discretion and subject only to the limitations

strict compliance with the Code and its IRR. applied as an alternative penalty on the penalty imposed under MC 6, s.2005, which was issued purposely to rationalize the penalties to be imposed by the Commission to insure Thus, it could be said that the appropriate penalty under Sec. 54.1 of the SRC may be

sanctions or to the filing of criminal charges against the person/s responsible for the foregoing penalties shall be without prejudice to the imposition of other administrative violation. Likewise, under the same provision of the Circular it states that the imposition of the

in the application of the penalties provided for in the SRC. application of SRC Section 54 as an alternative penalty, but to lay down a rule of preference The clear tenor and intention of Memorandum Circular is not to remove the

legislative intent behind the law. Section 54 for violators of any of the provision of the SRC. Neither does it defeat the The pursuit of this purpose clearly does not foreclose the possibility of applying

of both the offense and the offender clearly indicate good faith or a clear mistake of fact without taint of bad faith or negligence, otherwise, the imposition of a fine under the SRC should be considered as the more appropriate penalty. Needless to say, the determination of whether the circumstances warrant the imposition of a fine under the SRC provision rests solely upon the Commission. Should the Commission decide that any of the provision under Section 54 of the SRC is the more appropriate penalty, Memorandum Circular No. 6 Series of 2005 ought not to be deemed a hindrance. of the administrative monetary penalty provision of SRC such that where the circumstances Hence, the Memorandum Circular establishes a rule of preference in the application

not remove the imposition of any of the penalty provided for under Section 54 of the SRC as an alternative penalty for violations of any of the provision of the SRC and its IRR. It is, therefore, understood that SEC Memorandum Circular No. 6 Series of 2005 does

imposed the following administrative sanctions: above-mentioned pertinent provisions of the SRC and the 2015 SRC Rules and is hereby WHEREFORE, premises considered, the panel finds that the Respondent violated the

1. A fine of One Million Pesos (P1,000,000.00) for violation of Section 26 paragraphs 1 and 2 of the SRC in relation to Rule 26.2 of the SRC Rules and Section 54 of the SRC;

2. A fine of One Million Pesos (P1,000,000.00) for violation of Section 28 of the SRC in relation to SRC Rule 52.1.7.5.2;

3. Disqualification from being a registered person pursuant to Sections 28 and 29 of the SRC; and

4. Disqualification from being an officer, member of the Board of Directors or person performing similar functions pursuant to Section 54.1 of the SRC.

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and Review Committee of MSRD may institute on the basis of evidence that it may, now or hereafter secure, including, among others, to institute further action to charge responsible persons on the basis of the actual count or occurrences of violations committed. Finally, this Decision is without prejudice to any further action that the Investigation

SO ORDERED

11 June 2021.

MARLONG.FACUN a Chairman

EMMAA.VALENCIA Member ERWIN EDWARD P. MENDINUETQ CAA Member

Copy furnished:

Secretariat Building, PICC Complex, Roxas Boulevard, Pasay City Securities and Exchange Commission ASSISTANT DIRECTOR ADAN EVAN O. PASCUA Markets and Securities Regulation Department

MARLO N. MORON Block 8, Lot 12, MS2, Brgy. Navarro, General Trias, Cavite

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