Disclaimer: This article is for informational purposes only and does not constitute financial advice. BitPinas has no commercial relationship with any mentioned entity unless otherwise stated.
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The Securities and Exchange Commission (SEC) has issued a public advisory warning against investing in LS, KBS, and their related entities, declaring that they are not authorized to sell or offer securities in the Philippines.
The Commission identified the group operating under various names, including LS KBS Crypto Trading, KBSEX Exchange, and LS Crypto Currency Humanitarian Org, among others. The group is the central figure in numerous BitPinas reports from December regarding a crypto scam allegedly operating in Bacolod and several areas in the Philippines.
Unauthorized Operations
- According to the SEC, these entities are actively using social media to entice the public to register and engage in trading activities through their website and mobile application known as the “KBS App”.
- The Commission’s investigation revealed that the group promises “daily income and humanitarian benefits” in exchange for initial deposits, typically amounting to $100 or more, paid via GCash, USDT, or bank transfers.
The SEC stated that LS KBS and its affiliated entities “are not registered with the Commission as a corporation, partnership, or One Person Corporation”. Consequently, they lack the necessary secondary license to solicit investments or offer securities to the public as required by the Securities Regulation Code (SRC).
False Claims and Red Flags
The advisory highlighted several red flags regarding the group’s operations:
- Humanitarian Front: The scheme portrays itself as a “trading platform for humanitarian missions”.
- Unverifiable Licenses: The operators claim to hold a U.S. Money Services Business (MSB) license to project legitimacy. The SEC noted this claim appears “unverifiable or potentially fraudulent” and does not authorize them to sell securities in the Philippines.
- Recruitment Mechanics: Participation requires securing an invitation link and joining private messaging groups, such as BonChat.
Context: The Collapse and ‘Exit Scam’
The SEC’s warning aligns with recent reports of the platform’s collapse.
- In December 2025, BitPinas reported that withdrawals on the KBS Exchange had been frozen, with the “LS Team” marketing group announcing a “termination” of their partnership with the platform.
- Following the withdrawal freeze, the group began directing investors to migrate to a new, unlicensed platform called “AUX Exchange” (or AUX O-Coin).
- Victims reported that “analysts” and mentors, who previously promised stable returns, became hostile when questioned about trapped funds, with one analyst telling a victim, “That’s your business”.
The scheme also implemented a “recruit-to-withdraw” policy, requiring members to invite new investors before being allowed to access their funds, which is a classic indicator of a collapsing investment fraud.
The SEC issued a stern warning to individuals involved in the promotion of the platform.
- Those who act as “salesmen, brokers, dealers or agents, representatives, promoters, recruiters, influencers, endorsers, and enablers” of the LS KBS platform may be held criminally liable.
- Violators face a maximum fine of Five Million Pesos (₱5,000,000.00) or imprisonment of Twenty-One (21) years, or both, pursuant to the Securities Regulation Code and the Financial Products and Services Consumer Protection Act (FCPA).
Report Suspicious Activity
The SEC urges the public to exercise “extreme caution” and to report any activities related to these schemes to the Enforcement and Investor Protection Department (EIPD) via email at epd@sec.gov.ph. (Read more: What to Do If You Are a Victim of Crypto Scams Like LS KBS / AUX Exchange)
This article is published on BitPinas: SEC Issues Advisory Against LS KBS; Declares Entities Unauthorized to Sell Securities
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