SEC creates office to monitor lending firms

Jaehwa Bernardo, ABS-CBN News

Posted at Mar 20 2022 11:52 AM | Updated as of Mar 20 2022 02:11 PM

MANILA — The Securities and Exchange Commission (SEC) is creating an office that would monitor lending companies as part of its crackdown against illegal and abusive lenders, the Department of Finance said in a statement Sunday.

"We are also creating a Financing and Lending Companies Division within the SEC to focus exclusively on the regulation and monitoring of these entities," said SEC Chairman Emilio Aquino in a report to Finance Secretary Carlos Dominguez III, the statement read.

Dominguez had earlier asked Aquino to intensify the SEC's measures against illegal and abusive lending companies, most of whom charge "very high" interest rates.

Aquino said the SEC would focus its campaign against abusive lending companies following complaints that some of these firms "threaten" or "insult" borrowers.

The regulator has an online team that "conducts regular sweeping operations, monitors all complaints, and goes through the different social media platforms to check on possible abusive or illegal lending practices," said Aquino.

For 2022, the SEC began its intensified crackdown with a "successful operation" against Cashtrees Lending Corp, according to the DOF statement.

Majority of online lending applications (OLAs) handled by Cashtrees — such as Goodpocket, Easymoney, 365 Cash, and Rushloan — are unregistered with the SEC, the regulator said.

Forty-six employees, including the manager of Cashtrees Lending, were arrested for violating the Cybercrime Prevention Act and the Lending Company Regulation Act (LCRA), Aquino said in the statement.

The SEC said it revoked the registration of 2,081 firms and "secured" the conviction of 76 individuals in 8 cases for violating the LCRA.

The commission has also issued cease-and-desist orders against 73 OLAs and cancelled the licenses of 36 financing or lending companies over similar violations, it added.

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