Metro Manila (CNN Philippines, June 30) – The country’s corporate regulator has ordered six lending and financing firms to immediately halt their operations following complaints of “abusive” debt collection against their customers.
The Securities and Exchange Commission (SEC) served a separate cease and desist orders (CDOs) last June 26 to Surity Cash Lending Corp., Populus Lending Corporation, U-Peso.PH Lending Corporation, FESL Lending Corp., Philippine Microdot Financing Corp., and Armorak Lending, Inc.
“The order covers the companies’ branches, extensions, satellite offices, units, and online lending platforms (OLPs), together with , operators, promoters, representatives, and agents,” the SEC statement on Friday read.
It added that the lending firms have violated their responsibility of fair and respectful treatment of their clients under the SEC memorandum circular No. 18 and Republic Act No. 11765 or the Financial Products and Services Consumer Protection Act (FCPA).
Section 1 of the MC 18, in relation to the Section 4.4 of the RA 11765, prohibits any financial service providers from making use of threats, violence, or other criminal means to harm against their clients.
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The case stemmed from a joint operation between the SEC authorities and the Philippine National Police Anti-Cybercrime Group which resulted in the arrest of eight employees of Realm Shifters Business Process Outsourcing Services.
The company was found to be the third-party collecting agent for several OLPs and companies such as U-Peso, Philippine Microdot, and Armorak.
Following the issuance of the CDOs, the SEC said it has filed a criminal complaint against the lending and financing companies before the Department of Justice.
In September 2019, the regulator ordered the closure of 19 online lending companies citing complaints of invasion of privacy and harassment.
