The Securities and Exchange Commission (SEC) has issued cease and desist orders to six online lending companies that engage in the activity without the necessary license from the regulator.
In an order issued on March 22, the commission en banc ordered PesoKwento, Pondo Cash, TBAG, Cash Sky, Loan Cash and East Cash to immediately cease “engaging in, carrying out, promoting and facilitating any or loan transaction until they have incorporated and obtained the required SEC authorization for such activities.
“The Companies, their agents, representatives and promoters, and the owners and operators of their hosting sites, have been further directed to cease offering and advertising their lending business via the Internet or any other media, and to remove any material involving such,” the SEC added.
The commission said that none of the groups was registered as a company, so they had not obtained a certificate of authorization to operate as a loan or finance company.
Republic Act No. 9474, or the Credit Company Regulation Act of 2007 (LCRA), requires persons or entities operating as loan companies to register as companies and obtain SEC l necessary authorization to operate.
The SEC said it also received complaints from several borrowers about “unfair collection practices and acts of harassment by online lending operators, committed in the form of threats to ruin their reputations and cause physical harm to their persons. and their families.”
“[T]”Abusive collection practices, misrepresentations and unreasonable conditions perpetrated and imposed by online lending operators, their agents and representatives are precisely the acts and practices which, as a matter of principle, the State seeks to prevent and sanction”, the commission said. added.
On March 19, the SEC announced that it would create a financing and lending division focused exclusively on the regulation and supervision of such companies as part of its crackdown on illegal lending.
SEC Chairman Emilio B. Aquino says the commission will continue to step up its crackdown on predatory loan companies following consumer complaints about certain companies’ collection practices, involving threatening or insulting borrowers. .
The SEC has an online team that performs regular sweeps, monitors all complaints, and goes through different social media platforms to check for possible abusive or illegal lending practices.
“To date, we have revoked more than 2,000 certificates of registration from loan companies that have not obtained their required certificate of authority, in accordance with the LCRA. Our next step is to continue this crackdown on unregistered and abusive data collection practices. [online lending applications]said Mr. Aquino in a report to the Department of Finance. — Luisa Maria Jacinta C. Jocson