The Securities and Exchange Commission (SEC) has ordered online lending platform Peso Flow to cease operations and take down its website and other digital channels after finding that it was conducting unauthorized financing activities while using the corporate identity of a registered financing company.
In a cease-and-desist order dated Oct. 30, the SEC’s Financing and Lending Companies Department (FinLenD) directed the operators of Peso Flow to immediately stop engaging in, promoting, or facilitating financing and lending activities without the required regulatory authority.
The order also requires Peso Flow to shut down its website, mobile applications, social media accounts, and other online channels used to offer or facilitate financing services.
The SEC action followed a formal complaint filed by Sofi Financing Inc., which accused Peso Flow of falsely presenting itself as an affiliate and using its corporate identity in financing transactions.
Sofi Financing, a financing company registered with the SEC, denied having any connection with Peso Flow and clarified that its official online lending platform is Finbro.ph.
An investigation by FinLenD found that Peso Flow had not obtained a certificate of authority to operate as a financing company, as required under Republic Act No. 8556, or the Financing Company Act of 1998.
The regulator also determined that Peso Flow and its operators were not authorized representatives, agents, third-party service providers, or digital channels of Sofi Financing.
“[Peso Flow and its representatives] possess no demonstrated regulatory authority of their own, and they derive none from Sofi,” the SEC said in its order.
The cease-and-desist directive covers Peso Flow’s owners, officers, representatives, service providers, and other individuals or entities acting on its behalf.
It also prohibits the platform from claiming, either directly or indirectly, that it is owned, operated, or affiliated with Sofi Financing.
The SEC emphasized that a financing company’s regulatory authorization cannot be transferred or used by another entity without the commission’s approval.
“The unauthorized use of another financing company’s corporate identity cannot supply what the law requires the Commission itself to grant. Regulatory authority is personal to the entity upon which it is conferred. It cannot be borrowed, appropriated, simulated, or manufactured through misrepresentation,” the order stated.
