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FOR ABUSIVE PRACTICES: SEC to 6 funding firms: “Stop your operations!”


The Securities and Exchange Commission (SEC) has ordered six lending and financing companies to stop operating for employing unfair debt collection practices.

In separate orders issued on June 26, the SEC Financing and Lending Companies Division directed Surity Cash Lending Corp., Populus Lending Corporation, U-Peso.PH Lending Corporation, FESL Lending Corp., Philippine Microdot Financing Corp., and Armorak Lending, Inc. to immediately cease and desist from engaging in or carrying out any unfair debt collection practices in connection to any lending activity or transaction.

The order covers the companies’ branches, extensions, satellite offices, units, and online lending platforms (OLPs), together with their owners, operators, promoters, representatives, and agents.

OLPs of the lending and financing companies include: Surity Cash for Surity Cash Lending; PesoPop, PesoCow, NewCash, and LuckyLoan for Populus Lending; UPeso, Pera4U, PeraLending, and LoanMoto for U-Peso.PH Lending Corporation; Start Loan, Pondo Loan, and First Cash for FESL Lending Corp.; Pautang Peso, Borrow Peso, King Loan, Loan Peso, Lendpeso Market, Loan Quick, CashCloud, Cash Star, FreePeso, Going Loans, Peso Network, and Red Cash for Philippine Microdot Financing Corp.; and Ayudas and WeLoan for Armorak Lending, Inc.

The companies were found to have employed abusive collection or debt recovery practices against their customers, in violation of their responsibility of fair and respectful treatment of their clients, provided under SEC Memorandum Circular No. 18, Series of 2019 (MC 18) and Republic Act No. 11765, or the Financial Products and Services Consumer Protection Act (FCPA), and its Implementing Rules and Regulations (SEC FCPA IRR).

Section 1 of MC 18, in relation to Section 4.4 of the SEC FCPA IRR specifically prohibits financial service providers from making use of threats to take any action against their clients, as well as contacting persons in the borrower’s contact list other than those who were named as guarantors or co-makers, among others.

The issuance of the CDOs follows the filing of a criminal complaint against the lending and financing companies before the Department of Justice, for violation of Section 12(1), 12(2)(a), and 12(3)(a) of the LRCA, Section 8(d) of the FCPA, and Rule 8 Sections 4.2(B), 4.4(A), 4.4(C), 4.4(D), and 4.4(H) of the SEC FCPA IRR.

The case stemmed from a joint operation between the SEC Task Force on Online Lending Application and the Philippine National Police Anti-Cybercrime Group (PNP-ACG), following several complaints against several SEC-registered OLPs, particularly Loanmoto, Lendpeso, and Weloan.

The operation resulted in the arrest of eight employees of Realm Shifters Business Process Outsourcing Services, which was found to be the third-party collecting agent for several OLPs and companies such as U-Peso, Philippine Microdot and Armorak.


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