The Securities and Exchange Commission (SEC) issued a cease and desist order against 11 online lending apps for operating without a license.
Their owners and operators failed to secure their respective certificates of authority to operate as lending or financing companies, compelling the SEC to issue an order against the following online lenders:
- Cash Whale
- Cash 100
- ET Easy Loan
The order was issued on Friday, the SEC said Monday.
The unauthorized lenders gain access to personal information kept in a borrower’s mobile phone—contact numbers, Facebook accounts and email addresses—and use these to exact prompt payment.
Based on an investigation conducted by the SEC, the lending operators also threaten to post the matter on social media or file charges at the barangay level should the borrowers fail to settle their outstanding balance.
“The abusive collection practices, misrepresentations, and unreasonable terms and conditions imposed by the Online Lending Operators and their agents and representatives exemplify the practices that as a matter of policy, the State seeks to prevent,” the SEC order read.
Nineteen other online lending apps previously received a cease and desist order from the SEC, namely:
- Instant Pera
- Lendmo Philippines
- Crazy Loan
- Flash Cash
- MoneyTree Quick Loan
- Pera Express
The corporate regulator has revoked the certificates of registration of over 2,000 lending companies for failing to secure the necessary documents, according to the SEC.
The commission warned that Section 12 of the Lending Company Regulation Act penalizes those who operate unauthorized lending businesses with a fine ranging from P10,000 to P50,000 or imprisonment of six months to 10 years or both. —Dona Magsino/VDS, GMA News