(Eagle News) — The Land Transportation Franchising and Regulatory Board on Thursday, March 28, warned the public against investing with Yellowdot Transport Terminal Inc.
The LTFRB issued the warning in a two-page notice after it ruled the company, which offers the “Millennial Jeepney” that is under the Public Utility Vehicle Modernization Program, was running an investment scheme that was prohibited under its Articles of Incorporation submitted to the Securities and Exchange Commission.
Under the scheme, an investor makes a P250,000 downpayment for the acquisition of the jeep, with Yellowdot promising a “high return of investment” amounting to P55,000 to P85,000 per month.
The remaining amount of the unit, estimated at P1,950,000, is then financed through a car loan and registration.
After full payment of the car loan, ownership of the unit is transferred to the investor.
According to the LTFRB, this was an investment scheme since an investment of money was involved, the P250,000 down payment and P30,000 monthly deducted from the monthly income; there was an investment in a common enterprise because “the funds are pooled into the corporation (which) promises to manage the fleet of vehicles using the investments from the public; there was “promise of profits” because the corporation guarantees a minimum monthly income of P55,000; and the “income is generated primarily from the efforts of others because the corporation will manage and operate the fleet of vehicles while the investor only waits for his share of income.”
In line with this, the LTFRB also ordered Yellowdot to “cease and desist from offering” such investment contracts to the public “until they comply with existing laws and regulations.”
The notice was signed by LTFRB Chair Martin Delgra III and Board Members Ronaldo Corpus and Antonio Gardiola Jr.
