Tuesday, March 5, 2024

3 illegal online 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 agency and to stop employing abusive collection practices.

Photo from National Privacy Commission

In an order issued April 26, the SEC directed Golden Cash, Help Cash, and Grace Cash to immediately cease and desist from engaging in any lending activity until they have secured the necessary registration and license. The online lending operators were likewise directed to stop from engaging in unfair debt collection practices.

The SEC also ordered the online lending operators to stop offering and advertising their lending business through the Internet or any other media, and to delete materials involving such.

The SEC issued the order after finding that Golden Cash, Help Cash, and Grace Cash are not registered as a corporation with the commission. As such, they cannot secure a Certificate of Authority to Operate as a Lending/Financing Company.

“[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 SEC 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.

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