SEC: Stricter penalties vs bogus lending firms
SEC has issued a statement warning those engaged in abusive debt collection practices may now be criminally prosecuted under RA 11765
To further protect the public from potential frauds, the Securities and Exchange Commission on Monday warned that stricter penalties will be slapped entities engaged in unauthorized lending activities.
The regulator, in a press statement, also reiterated that those engaging in abusive debt collection practices may now be criminally prosecuted under Republic Act 11765, or the Financial Products and Services Consumer Protection Act and RA 9474, or the Lending Company Regulation Act.
Financial service providers and their collection agencies, counsels, and other authorized third-party representatives — as stated in Rule 8, Section 4.4 of the recently issued SEC FCPA Rules and Regulations — are prohibited from employing abusive collection or debt recovery practices against their financial consumers.
Likewise, Rule 15, Section 1 of the SEC FCPA IRR provides that any person who willfully violates its provisions will be penalized with a maximum fine of P2 million or imprisonment of five years, or both.
Following a joint operation last 16 May, SEC Enforcement and Investor Protection Department and the Philippine National Police Anti-Cybercrime Group arrested eight individuals identified as operators, managers, employees and agents of Realm Shifters BPO Services/FESL BPO Services in Pasig City.
Financial service providers and their collection agencies and other unauthorized third-party representatives are prohibited from resorting to abusive debt recovery practices against their financial consumers.
The operation also involved forces of the Eastern Police District Mobile Force Battalion, PNP Intelligence Group and the Special Weapons and Tactics Philippines.
The Pasig City Regional Trial Court Branch 159 issued the search warrant against Salvador Jennifer Mangubat, the registered owner of Realm Shifters/FESL, and other managers, supervisors, team leaders, operators, and occupants of the office for misuse of device penalized under Republic Act 10275, or the Cybercrime Prevention Act of 2012.
According to the SEC, entities similar to Realm Shifters/FESL should “respect the privacy and protect the data of their financial consumers.”
“Such entities are required to inform financial consumers if their data will be shared with third parties,” it added.
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