SEC suspends 84 lending firms
MANILA, Philippines – The Securities and Exchange Commission (SEC) on Thursday, March 23, announced the suspension of the primary license of 84 lending companies after they failed to obtain a secondary license, or a Certificate of Authority (CA) to operate as a lending company.
The CA is required under Republic Act No. 9474 or the Lending Company Regulation Act of 2007, which the SEC has taken the lead in implementing.
Earlier, the SEC sent out more than 300 show cause letters to registered companies engaged in lending which have not secured a CA to operate as a lending company.
The show cause letters required the companies to explain why their certificate of registration as a corporation should not be suspended over their failure to get a CA.
The SEC said 84 of the show cause letters were returned to sender.
Because of this, the 84 firms have been suspended for 60 days. If they still do not respond within the suspension period, proceedings for revocation of their certificate of registration will immediately ensue, the government agency said.
Justina Callangan, director of the SEC's Corporate Governance and Finance Department, said the firms had been given enough time to comply with the law.
"The Commission is one with the President in adopting a tough stance against illegal lending, that is why it is pursuing with much vigor all those engaged in it," Callangan said in a statement on Thursday.
The President himself directed authorities to go after illegal lenders, particularly '5-6' lenders who operate without licenses and charge exorbitant interest rates.
As for the 84 firms, the SEC said that aside from suspension, they could face "a fine of not less than P10,000.00 or imprisonment of not less than 6 months but not more than 10 years or both." – Rappler.com