The Court of Appeals has upheld the Securities and Exchange Commission (SEC) cease-and-desist order (CDO) against Superbreakthrough Enterprises Corp., operating as 1UP Time, for illegally soliciting investments from the public. In a ruling on 11 February 2025, the Fifth Division of the appellate court rejected the company’s petition and confirmed the SEC’s decision making the CDO permanent.
The court found the SEC actions as justified and cited a prior Supreme Court ruling that established the agency’s authority to issue CDOs when certain conditions are met. These include proper investigation, the likelihood of fraud or irreparable harm to investors, and a failure to obtain proper licensing or registration.
The SEC issued the CDO in December 2023 following an investigation by its Enforcement and Investor Protection Department (EIPD) which revealed that 1UP Time was offering securities in the form of investment contracts disguised as product packages. These packages, priced from P10,000 to P188,000, promised returns through product discounts, recruitment bonuses, and other incentives, and were marketed as investments without the required secondary license from the SEC.
The appellate court emphasized that 1UP Time was given due process, as the company was informed of the SEC’s findings and had the opportunity to contest the order. The ruling also highlighted company knowledge of the allegations, noting that its product packages were effectively deemed unregistered investment contracts.
The SEC revealed that 1UP Time’s business model relied on a binary recruitment system, where customers paid money with the expectation of earning profits through the efforts of their recruits. The court confirmed that these activities harm investors and are fraudulent practices.
Additionally, 1UP Time president, Julius Allan Nolasco, had previously been the subject of a similar CDO for promoting illegal investment activities through Alphanetworld Corporation, also known as NWorld.
With this decision, the Court of Appeals reinforced the SEC’s role in protecting investors from unregistered securities offerings and investment fraud.
