SEC orders more online lenders to stop operating
THE SECURITIES and Exchange Commission (SEC) is on its third wave of eliminating illegal online lending applications with the issuance of a new cease and desist order against 12 fraudulent operators.
The country’s corporate regulator said in a statement yesterday it ordered last week the shutdown of A&V Lending Mobile, A&V Lending Investor, A.V. Lending Corp., Cashaku, Cashaso, CashEnergy, Happy Loan, Peso Pagasa, Vito Lending Corp., Phily Kredit, Rainbow-Cash and Rainbowcash. Ph Lending Corp.
The cease and desist order was issued on Oct. 10 upon learning the 12 online lenders failed to secure necessary licenses to facilitate lending activities.
“The SEC enjoined the owners and operators of the online lending applications, their agents, representatives and promoters, the owners of their hosting sites and all persons acting for and on their behalf to immediately cease and desist, under pain of contempt, from engaging in, promoting and facilitating unauthorized lending activities,” it said in the statement.
The crackdown is in compliance with Republic Act No. 9474 or the Lending Company Regulation Act of 2007, which requires lending companies to be established as a corporation and to secure authority to operate from the SEC before conducting business.
“Based on the findings of the SEC Corporate Governance and Finance Department (CGFD), the online lending applications and their operators are not registered as a corporation or partnership and/or have not been issued certificates of authority to operate as lending or financing companies,” the SEC said.
It identified A&V Lending Mobile and its supposed operator A&V Lending Investor as having no record of registration, while A.V. Lending Corp. had a registration that had already been revoked.
Also absent in the regulator’s database are Peso Pagasa and its supposed operator Vito Lending Corp., neither are Rainbow-Cash and its supposed operator Rainbowcash.Ph Lending Corp.
The SEC said the issuance of the cease and desist order came after it received complaints from victims of the fraudulent lenders. The Enforcement and Investor Protection Department of the SEC said it found the illegal lenders to have been reaching out to the contacts of the borrowers, exposing their debts and threatening legal action and public shaming.
“Considering that the Online Lending Operators are not incorporated entities or have no Certificate of Authority to Operate as Lending Companies or Financing Companies, the lending activities and transaction are illegal and have to be stopped immediately by this Commission,” the order read.
It added the illegal online lenders are exercising “unfair debt collection practices,” therefore violating SEC Memorandum Circular No. 18 Series of 2019, as they use threats and disclose personal information of borrowers.
The new batch of illegal online lenders shut down by the SEC comes on top of 30 other firms it ordered to close last month. These are as follows: Cash Whale, Cash 100, Cashafin, CashFlyer, CashMaya, Cashope, Cashwarm, Cashwow, Creditpeso, ET Easy Loan, Peso2Go, Pera, QuickPera, Lendmo Philippines, Binixo, CashBus, Cashcat, Cashuttle, Crazy Loan, Flash Cash, Happy2Peso, Hatulong, MeLoan, MoneyTree Quick Loan, Pera Express, Pera4u, Peramart, PesoLending, QuickPeso and Umbrella.