SEC takes aim at faulty credit companies

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Iris Gonzales (The Philippine Star) – July 4, 2021 – 12:00 am

MANILA, Philippines – The Securities and Exchange Commission (SEC) has cracked down on more stray lending firms.

He revoked the Certificate of Authority (CA) of KingABC Lending Corp., which operates the Pondo Loan, Start Loan, Green Loan and Loan Club online lending platforms.

This means that KingABC Lending Corp. can no longer operate as a loan company after the SEC finds it engages in unfair debt collection practices.

In an order dated June 7, the SEC’s Corporate Governance and Finance Department (CGFD) found that KingABC had committed 15 violations of SEC Circular Memorandum 18, which outlines the prohibition on unfair practices by debt collection from finance companies and loan companies.

KingABC reportedly threatened to shame borrowers on social media by posting their names as scammers and contacting people on the borrower’s contact list despite not being named as co-creators or guarantors, said the SEC.

According to the SEC, KingABC also used obscenities, slurs or profane language in its debt collection and threatened to sue borrowers on the basis of fabricated legal grounds.

The CGFD had previously sanctioned KingABC for its first and second violations of the circular memorandum. A third violation merits the imposition of a fine, suspension or revocation of the company’s CA, depending on the facts, circumstances and seriousness of the case.

“It is also clear that at this point, the revocation of the Respondent’s CA is not simply appropriate, but rather necessitated by the seriousness and number of his infractions,” said the CGFD of the SEC. , noting that apart from KingABC’s 15 violations, 53 other complaints were filed. against the company for its debt collection practices, as of the date of the order.

“Even more telling is the fact that after the formal charge was issued, the Respondent’s abusive collection practices only worsened and became more hostile based on the evidence submitted by the Complainants. The Department noted messages filled with death threats, profanity and other heinous and objectionable language. “

KingABC’s board revocation brings the total number of finance / loan companies whose licenses have been canceled due to various violations of SEC rules and regulations to 35.

Last year, the SEC ordered 58 online loan applications to go out of business for lack of authorization to operate.

The SEC continues to monitor loan and finance companies for their compliance with applicable laws, rules and regulations.


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