3 illegal lenders told to cease operations
THE Securities and Exchange Commission (SEC) has ordered three online lending operators to stop conducting lending activities without the necessary authorization from the Commission and to stop employing abusive collection practices.
In an order issued April the online lending operators 26, the Commission En Banc to stop offering and advertising directed Golden Cash, Help Cash, their lending business through the and Grace Cash to immediately internet or any other media, and to cease and desist from engaging delete materials involving such. in, carrying out, promoting and The SEC issued the order facilitating any lending activity/ after finding that Golden Cash, transaction until they have secured Help Cash, and Grace Cash are the necessary registration not registered as a corporation and license from the Commission. with the Commission. As such,
The owners, operators, they cannot secure a Certificate of promoters, representatives, and Authority to Operate as a Lending/Financing agents of the online lending Company. operators were likewise directed Republic Act No. 9474, or to stop from engaging in unfair the Lending Company Regulation debt collection practices, as deAct of 2007 (LCRA), requires fined under SEC Memorandum persons or entities operating as Circular No. 18, Series of 2019 lending companies to register as (MC 18). corporations and to secure from
The Commission also ordered the SEC the necessary authority to operate.
“[T]he Commission finds that the continued operations of Golden Cash, Help Cash, and Grace Cash constitute a clear violation of, and should be penalized pursuant to the [LCRA] because it engages in or carries out a lending business without the required license from the Commission,” the Commission En Banc held.
Further, findings by the SEC Enforcement and Investor Protection Department (EIPD) revealed that the online lending operators have been employing unfair collection practices, prohibited under MC 18.
The EIPD noted that the online lending operators have been harassing, threatening, publicly humiliating their respective borrowers, and imposing hidden charges and excessive processing fees.
“The acts of these unregistered online lending operators in illegally offering and providing loans to the public, charging high interest rates, and subjecting its debtors to unfair treatment through abusive and even libelous language in collecting the loaned amount…have no place in a society that is governed by and faithfully adheres to positive laws,” the Commission En Banc noted.
To see the list of licensed lending and financing companies and their registration status, please visit the Lending and Financing Companies corner on the SEC website at https://www. sec.gov.ph/lending-companiesand-financing-companies-2/lending-companies-and-financingcompanies/.