The Securities and Exchange Commission (SEC) has permanently revoked the Certificate of Authority (CA) of KingABC Lending Corp. to operate a loan company for engaging in unfair debt collection practices.
In a resolution dated August 2, the agency’s Corporate Governance and Finance Department (CGFD) dismissed KingABC’s petition for reconsideration for lack of merit. The said company operates the Pondo Loan, Start Loan, Green Loan and Loan Club online lending platforms.
âThe ministry reiterates that the lending activity is imbued with public interest. As such, the commission is mandated to ensure that only loan companies that seriously abide by laws, rules and regulations are allowed to operate, âaccording to the resolution, which became final and enforceable after KingABC did not filed an appeal within the time limit.
The agency issued the revocation order on June 7 after finding that KingABC had committed 15 violations of an 18 SEC Circular Memorandum issued in 2019, which prohibits unfair debt collection practices among finance companies and loan.
The SEC found that KingABC threatened borrowers with shame on social media by posting their names as scammers and contacting people on the borrower’s contact list, although they were not named as co. -creators or guarantors.
KingABC also used obscenities, slurs or profane language in its debt collection, and threatened to sue borrowers on fabricated legal grounds, the SEC said.
The agency has already penalized KingABC for its first and second violations of the said rule. A third violation merits the imposition of a fine, suspension or revocation of the company’s certificate of authority, depending on the facts, circumstances and seriousness of the case.
In addition to KingABC’s 15 violations, the agency noted that 53 other complaints had been filed against the company for its debt collection practices.
The SEC circular memorandum was released on September 8, 2019 as part of its response to several complaints of unreasonable, abusive and unfair practices that loan and finance companies have used to collect debt from borrowers.
In its appeal, KingABC argued that the 15 complaints contained only allegations without evidence and that the volume of complaints alone was not sufficient to justify the revocation of its certification authority, given that the circular of the SEC requires proof of these allegations.
The SEC, however, maintained that the evidence on the record more than adequately supported the revocation of KingABC’s documents, noting that during its investigation, the company itself admitted that its agents had “done something wrong.” illegal and unauthorized âandâ unfair misconduct âtowards its borrowers.
“A review of all the screenshots of the messages submitted by the 15 complainants, including the 53 others who also filed complaints against the respondents, reveals some commonalities and recurring patterns, including the substance of the threats and the construction of the sentence of said messages “, indicates the resolution. .
“To a reasonable mind, all of this evidence proves that the Respondent committed 15 violations of the SEC MC 18. Thus, it was not possible for the CGFD to find the Respondent guilty of violating the SEC MC 18 and imposes on him the penalty of revocation of his license. “