The Securities and Exchange Commission has issued cease and desist orders against 11 online lending companies for soliciting investments from the public without the necessary license.
These companies include Cash Whale, Cash 100, Cashafin, Cashflyer, Cashmaya, Cashope, Cashwarm, Cashwow, Creditpeso, ET Easy Loan and Peso2Go.
Also covered by the CDO are the 11 firms’ agents, representatives and promoters as well as owners of their hosting sites.
According to the SEC, the online lending operators offer loans to the public through their respective online applications/platforms. Their businesses are being advertised and promoted on Facebook.
The probe into these companies started after SEC received numerous complaints from the public of abusive lending and collection practices which include public humiliation and ridicule.
The companies were also found to be imposing high interest rates and unreasonable terms and conditions, making representations and violating the right to privacy of debtors.
Before a person can apply for a loan, he or she has to download the online lending application on his or her phone, giving the companies access to customers’ personal information.
The online lending operators use clients’ personal information to demand payment of the amount due, either by sending a text blast to the persons in the contact list and informing them that debtor refused to pay.
“Considering that the online lending operators have no certificate of authority to operate, the lending activities and transactions are illegal and have to be stopped immediately by this Commission,” the SEC said.