THE Securities and Exchange Commission (SEC) has ordered the permanent shutdown of Fast Track Worldwide, Inc., which it found operating an unauthorized investment scheme.
In an Aug. 20 resolution uploaded on its website, the corporate regulator has denied Fast Track’s motion to lift its cease-and-desist order, and has made such order permanent.
The company was issued the shutdown order in May after it was found to have engaged in offering investment contracts to the public. It filed a motion to lift the order in June.
While it is a registered corporation since February 2019, Fast Track is only authorized to engage in the direct selling of food and merchandise. Its registration specifically prohibits it from soliciting investments from the public.
However, the SEC found that the company is bundling its products with investment contracts. It sells beauty products, health products, clothes, appliances, books, and car care products, but resellers are promised profit through the recruitment of more sellers.
“That they are selling their products is uncontested; what is at issue… (is) the sale of its product was carried out as part of an investment package that guaranteed returns and added bonuses by recruitment of new members,” the SEC said. “This is what converted the activity into a sale of securities in the form of investment contracts.”
Such activity requires authorization from the SEC by obtaining a secondary license to sell securities. Fast Track did not have this authorization.
The SEC also said Fast Track was engaged in pyramiding, as its clients pay money to the company, receive the right to sell the products, get compensated for the recruitment of more members, and such compensation has nothing to do with the sale of the products.
With the resolution, Fast Track must permanently stop its operations, and will be prohibited from transacting any business involving funds in its depository banks.
The SEC has shut down at least five other companies this year for the sale of securities without a license. These are: JOCALS688 Beauty and Wellness Products Trading, Inc.; Building Our Success Stories Network, Inc.; CROWD1 Asia Pacific, Inc.; Lion City Finance Group, Inc.; and Payasian Pte. Ltd. Corp. — Denise A. Valdez