The Securities and Exchange Commission (SEC) has intensified its campaign against erring online lending companies, filing criminal charges, issuing cease and desist orders, imposing hefty penalties, and revoking licenses in a string of enforcement actions throughout July.
The SEC, in coordination with the National Bureau of Investigation (NBI) and the National Privacy Commission (NPC), filed criminal complaints against 173 employees, officers, and owners of Creditable Lending Corp., the operator of Easypeso, for allegedly engaging in abusive collection tactics.
The joint operation led to arrests at the company’s Pasig office and the seizure of computers, mobile phones, SIM cards, and scripts allegedly used to harass borrowers.
The company is being charged for violating the Financial Products and Services Consumer Protection Act (RA 11765), the Data Privacy Act (RA 10173), and the Cybercrime Prevention Act (RA 10175).
Following the raid, the SEC issued a cease-and-desist order halting Creditable Lending’s operations and marketing activities. The firm has been under scrutiny by the government’s Task Force on Online Lending Applications due to multiple harassment complaints.
CDO against Hinance Lending
The SEC also ordered Hinance Lending Investors Corp. — operator of HotCash, VI Peso, and KindCash — to stop operations for running an unregistered online lending platform, Magic Peso.
The SEC flagged the company for failing to disclose the platform in its business plan and violating memoranda that regulate the use of online lending platforms (OLPs).
LHL Online Lending fined for deceptive practices
LHL Online Lending Inc., operating under Pautang Online and Pautang Peso, was fined ₱129,000 for misleading loan terms in violation of the Truth in Lending Act.
The SEC found that the company misrepresented loan repayment periods and imposed hidden surcharges on borrowers who failed to meet shortened repayment terms.
₱1-M penalty for Link Credit Lending
The SEC imposed a ₱1-million fine on Link Credit Lending Investors Inc., doing business as iPeso and Pesoin, for violating rules against unfair debt collection practices.
Complaints from September 2022 to March 2023 revealed the company used harassment and threats, including contacting borrowers’ colleagues and emergency contacts.
Convenience Cash Lending’s license revoked
In a more severe action, the SEC revoked the corporate registration and license of Convenience Cash Lending Corp., operator of Zada Cash and BloomCash, for sending threatening messages and even funeral services to borrowers.
Over 600 complaints were received, with four formal cases forming the basis for revocation. The SEC had earlier issued a cease-and-desist order against the firm for failure to register with the Credit Information Corporation as required under RA 11765.
Jia Financing suspended for operating unregistered website
Lastly, the SEC suspended Jia Financing Inc. for 60 days and fined it ₱10,000 for operating the website jia.ph without disclosing it in its business plan — violating a moratorium on new OLPs.
The company also failed to disclose details about large loan offerings ranging from $50,000 to $200,000, in breach of disclosure rules.
However, the SEC issued a resolution Sept. 9 lifting the temporary suspension of its Certificate of Authority. With this, Jia is now fully authorized to operate and continues providing SME financing, invoice financing, and receivables financing solutions to entrepreneurs nationwide.
The SEC’s action followed Jia’s Motion for Partial Reconsideration and confirmed that the matter was purely administrative, not substantive. The regulatory body also confirmed that Jia is not an OLP but a duly licensed financing company focused on SMEs exclusively, not on consumer online lending.
Updated on Sept. 26 to reflect the SEC resolution lifting the suspension on Jia Financing
