An issue that grabbed headlines this past week is the pyramiding scam that bilked Filipinos out of a staggering P15-billion pesos.
At the heart of the scam is the company Aman Futures Group Phils. Inc., headed by Manuel K. Amalilio, reportedly a Filipino-Malaysian. Amalilio has since escaped to Malaysia, and Aman offices have been vacated, leaving thousands of Filipinos penniless and furious.
One has to question why we fall for promises of easy money. Inquirer columnist Randy David dissects the phenomenon in his November 14 column. He notes that "our brains sometimes seem hardwired for gullibility," and observes that his fellow columnist Michael Tan opined that "we find that testimonials from relatives, friends, and acquaintances
play an insidious role in these decisions that is resistant to critical
scrutiny." In a way, then, our family network, which plays a big role in providing needed support, works against us in this situation, since we will be more willing to believe what a relative says about something, simply because we trust in that relative.
At the same time, David notes, we are also willing to invest in something based on the authority of the person. On this, he writes, "the victims of the Aman Futures Group that ran the P12-billion
pyramiding scam in Visayas and Mindanao included local politicians,
businessmen, professionals, soldiers, and policemen. You would think
they would be crazy to invest so much money in a new company founded by a
former janitor and driver with no business credentials. But, enticed by
the huge and easy returns, they even brought in the savings of their
relatives, neighbors, and friends" Despite the questionable credentials of the company, people trusted that professionals would know if Aman Futures was on the level. They paid dearly for their trust.
At the same time, one has to wonder what role the government played in his economic tragedy. Both David and Philippine Star columnist Alex Magno question the failure of the government to properly vet a company such as Aman Futures. David notes, "Windfall profits such as those paid by Aman Futures to its first
investors should have alerted the concerned government agencies—the
regional office of the Securities and Exchange Commission, for one."
Magno concurs, saying "To date, no one has told us how Aman Futures is registered — or, more
important, how it managed to get itself registered. It is bad enough
that the Philippines is the extreme textbook case about how long it
takes to get a business registered. It is worse that despite those
tedious procedures for registering a business, a fraud like Aman Futures
manages to slip through the bureaucratic gauntlet and inflict its curse
of thousands of Filipinos."
Although measures have been taken by the Aquino administration to locate and arrest the perpetrators of this pyramiding scam, government officials have to take a look into how a questionable firm such as Aman Futures managed to escape their notice; as David notes, "The state has a duty to check without waiting for a complaint, and, if
warranted, to warn investors of the risks they are taking." By doing so, government officials can ensure that pyramiding scams such as Aman Futures will be less likely to happen in the future.