SEC suspends 66 firms and 18 partnerships
The Securities and Exchange Commission (SEC) had so far suspended 66 companies and 18 partnerships in a bid to wipe out all informal lenders in the country.
In its advisory on Wednesday, SEC advised the public of suspended lending companies, 66 of them are corporations while 18 are partnerships.
Some of these companies are Pautang Bayan Lending, Inc., 3CF Lending Corp., Allstate Loans Corp., Addmore Credit Resource, Inc., Anchor 8 Lending Systems Corp., Cambridge Credit Corp., Erlee Credit Corp., Planters Lending Corp., List Lending Investor, Inc., Kings Hopewell Group, Corp., Le Maison Lending, Inc., Primerica Credit Corp., Ready Resources Investors Lending Corp., San Miguel Credit Corp., Swiss Credit Corp., Thakuri Lending Corp., and Winthex Credit,.Inc.
Some of the suspended partnerships, on the other hand, include A.P. Lending Co., Ests Lending Investor Co., Fabconn Lending and Collection Co., Fuji Lending Investor Ltd. Co., SM Sons Credit Company, Sun Ace Lending Co., and Uni-Loans Lending Co.
“Any information regarding persons and entities engaging in lending business illegally, please call the Corporate Governance and Finance Department (CGFD) at telephone numbers 818-5476 or 818-5516 or make an online report through the i-Message Mo on the Commission’s website: www.sec.gov.ph,” SEC said in the advisory.
It was also just this month when SEC threatened to file criminal charges against five informal lenders as part of the government’s crackdown against loan sharks engaged in “five-six” lending.
SEC chairperson Teresita Herbosa earlier told Business Bulletin that the SEC-led investigation team is now gathering evidences against five specific individuals that may be involved in fivesix lending.
The team includes officials from local government units (LGUs), the Department of Trade and Industry (DTI), National Bureau of Investigation (NBI), and other law enforcement agencies.
“Five-six” lenders usually extend loans without collateral or any documentary requirements, but charge their borrowers an exorbitant nominal interest rate of 20 percent or more over an agreed period.
It simply states that when you borrow R5.00, you have to pay R6.00.
Herbosa said SEC is now looking into online advertisements, flyers, text messaging promos, and overt and collection activities in areas like public markets to investigate and expose informal lenders and file the appropriate charges against them.
Following President Rodrigo Duterte’s directive, the SEC earlier issued two advisories to inform the public about prohibited lending practices under the law and encourage informal lenders to register with the Commission.
The first advisory, issued in October last year, cited provisions of RA 9474, which makes it illegal to act as a lending company or investor unless registered with the Commission as a lending company.
“The said law mandates lending companies to organize only as corporations, making it illegal for individuals to engage in the business of lending without being registered as a corporation with the Commission and secure the required Certificate of Authority,” Herbosa said.
The second advisory warned informal lenders facing complaints for violations of RA 9474 and/or those engaging in “fraudulent, oppressive and illegal practices in lending to borrowers including those violating the Truth in Lending Act,” that they will be investigated for possible prosecution.
Among the illegal practices cited by the SEC are “charging unreasonable interest rates or fees, employing harassment tactics in collecting from its borrowers, coercing borrowers to buy on credit or otherwise appliances or other items, filing criminal complaints against borrowers as a circumvention of the prohibition against imprisonment for non-payment of debt and similar other activities.”
The Commission also allowed SECregistered lending companies without the required certificates to apply for this requirement provided that they secure it on or before April 30, 2017.
To help expose “five-six” lenders, Herbosa said she had also ordered an audit of lending companies in areas where there are perceived informal lenders.