I read the Performance Investment Products Corp. (PIPC) story last Friday and was curious enough to research its possible connection with the Performance Foreign Exchange Corporation (PFEC). I found out that the PIPC owner Michael Liew attended the inauguration of the PFEC Cebu branch as the Performance Chairman. The whole point of the initial post was that PIPC is somewhat related to PFEC. Given that relationship, I wrote that "I wouldn't "invest" in PFEC or any company in their group." I was surprised that a visitor to this blog took exception to the fact that I used the word "scam" in relation to PIPC. The Inquirer and the Daily Tribune calls it "$250-M scam" and "PIPC investment scam" respectively in their editions today so why shouldn't I call it what it is?
According to the lawyer of some clients, PIPC is "registered at the Securities and Exchange Commission as a research company and is not authorized to engage in foreign exchange trade. (Daily Tribune, 07/25/07 page 4).
This makes PIPC officially a SCAM. No ifs and buts about it.
Victor Agustin of Cocktales, Manila Standard (07/20/07) has a detailed insider look.
Forex scheme wallops Forbes crowd
"A NUMBER of Forbes, Dasmariñas, and Urdaneta crowd have suffered embarrassing foreign exchange losses after being suckered into placing a minimum of $40,000 in an Internet-based forex investment fund scheme...."
"Performance Investment started in the late ’90s as Performance Foreign Exchange Corp., with Liew taking in on board an ex-Allied Bank officer in Singapore, Roberto Borromeo, to help the venture hurdle the thicket of local regulatory rules...."
I am right. There's a major connection after all.
"The forex venture did immediately run into opposition from the Securities and Exchange Commission, which sued all the way to the Supreme Court, only to suffer a loss after the Bangko Sentral sided with Performance."They have good lawyers and lobbyists too.
"Borromeo, who admitted having already heard of the Performance implosion earlier this week, said he and Liew parted ways sometime in 2004, with Borromeo taking control of Performance Foreign Exchange..."
Sometime in 2004? Pretty vague... Performance Chairman Liew helped open the PFEC Cebu branch in 2004.
PFEC released an ad in the Philippine Star today denying any connection to PIPC and the Performance Group of companies.
"Borromeo sought to distance his company from the similarly named Liew venture, saying his Performance is limited to being an Internet-based financial intermediary, with clients themselves doing the foreign exchange trading using Performance’s software for a fee..."
Not entirely true. They do have that option but most clients don't trade and many that did usually lose money. They are discouraged to do so. PFEC account managers and executives usually do it for them. That's the best way to keep those commissions coming.Some clients of PIPC are suing the local incorporators as well. Some of the local incorporators come from wealthy and known families. I would give them the benefit of the doubt because no amount of money can be worth dragging their family name into the scandal. However, I will never believe that Michael Liew acted alone. His accomplices have to be discovered and punished as well.