Law seen to hit online scammers hard

THE chairman of the House Committee on Ways and Means on Tuesday said that a tougher crackdown on illegal online lending and investment scams “is in the offing” as President Rodrigo Duterte is likely to sign the proposed Financial Consumer Protection (FCP) Act this week.

House Committee Ways and Means chairman joeys arte sal ced a said in a statement the FCP Act will vest financial regulators with the powers of rule-making, surveillance and inspection, market monitoring, enforcement and adjudication powers over financial products.

Salceda, who is the principal author of the measure, said “sources in the Palace” told him that “the President is very likely to sign it this week.”

“In any case, it lapses into law on May 7,” he added.

According to the lawmaker, once enacted, the FCP Act means more powers to authorities, “jail time and steeper fines for fraudsters, as well as clearer laws and regulations on investments, lending and other financial products.”

The law also expands the subpoena powers of the Bangko Sentral ng Pilipinas and the Securities and Exchange Commission (SEC) over financial products and services.

It would also increase the fine for investment fraud to up to P10 million (about $190,000 at current exchange rates) on top of criminal sanctions. The regulators may soon also be able to file independent civil action on behalf of victims of financial or investment fraud.

Over the past few days, Salceda said the SEC has been conducting a crackdown on dubious online investments and online lenders.

While the lawmaker commends the regulator’s deeds, he also expects “an even bigger crackdown once the law is enacted.”

“I particularly want tougher moves against the harassment conducted by collectors of illegal online lending applications,” Salceda added. “I also want jail time for those who solicit unauthorized investments.”

According to Salceda, the proposed FCP Act “is a crucial balancing measure in our efforts towards financial inclusion.”

He said the proposed FCP Act will also strengthen confidence in the country’s banking sector.

“We badly need a confidence boost in the system following our grey-listing in the Financial Action Task Force,” Salceda said.

“[After the expected signing of the law] the next step is to write a good IRR and issuances based on the rule-making powers to be granted. In particular, I will be lobbying for an end to unjust and unfair debt collection practices to be one of the rules issued by the SEC on the matter, while we in Congress still debate proposals on the matter as well,” Salceda said.