SEC orders 3 online lending companies to halt operations │ GMA News Online
The Securities and Exchange Commission (SEC) announced on Thursday that it had ordered three online lending operators to halt their operations, for lack of the necessary authorization from the regulator.
In a statement, the SEC said that in an order issued on April 26, it ordered Golden Cash, Help Cash and Grace Cash “to immediately cease and desist from engaging in, performing, promoting and to facilitate any lending activity/transaction until they have obtained the necessary registration and license from the commission.
“Owners, operators, promoters, representatives and agents of online lending operators have also been ordered to cease engaging in unfair debt collection practices, as defined in SEC Memorandum Circular No. 18, series of 2019 (MC 18),” the company regulator said.
The SEC added that it also ordered the three online lending operators to stop offering and advertising their lending business via the Internet or any other media, and to remove documents implicating them.
The regulator said it issued the order after finding that Golden Cash, Help Cash and Grace Cash are not registered as companies with the SEC.
“As such, they cannot obtain a certificate of authorization to operate as a loan/finance company,” he said.
Republic Act No. 9474, or the Credit Company Regulation Act of 2007 (LCRA), requires persons or entities operating as loan companies to register as companies and obtain SEC l necessary authorization to operate.
“[T]The Commission considers that the continuation of the activities of Golden Cash, Help Cash and Grace Cash constitutes a clear violation of the law and should be sanctioned in accordance with the [LCRA] because it engages in or engages in lending activity without the required Commission authorization,” the SEC said.
In addition, the regulator said findings from its Enforcement and Investor Protection Department revealed that the three online lending operators engaged in unfair collection practices, prohibited under the MC. 18.
The SIFT noted that online lending operators harass, threaten, publicly humiliate their respective borrowers and charge hidden fees and excessive processing fees, the SEC said.
“The acts of these unregistered online lending operators of illegally offering and providing loans to the public, charging high interest rates and subjecting its debtors to unfair treatment through abusive language and even defamatory in the collection of the amount loaned…have no place in a society which is governed by and faithfully adheres to positive laws,” he said.
GMA News Online is attempting to reach the three online lending companies in question for comment. —BM, GMA News