The Securities and Exchange Commission (SEC) has ordered six online lending operators to stop conducting lending activities without the necessary license.
 
In a statement, the SEC said it directed PesoKwento, Pondo Cash, TBAG, Cash Sky, Loan Cash, and East Cash to immediately cease and desist from engaging in, carrying out, promoting, and facilitating any lending activity/transaction until they have incorporated and secured the requisite authorization.
 
This brings the number of online lending applications ordered to cease operations for lack of authority to operate as a lending or financing company to 72.
 
The SEC has likewise canceled the licenses of 37 financing/lending companies due to various violations of applicable rules and regulations.
 
"To date, we revoked over 2,000 Certificates of Registration of lending companies that failed to secure their requisite Certificate of Authority, according to LCRA. SEC Chairperson Emilio B. Aquino said, "our next step is to sustain this crackdown on unregistered and abusive collection practices [online lending applications]."
 
The six companies, their agents, representatives, promoters, and the owners and operators of their hosting sites were ordered to cease offering and advertise their lending business through the internet or any other media.
 
The SEC issued the order after finding that none of the groups were registered as a corporation with the Commission. As such, they could not secure a Certificate of Authority to Operate as a Lending/Financing Company (CA).
 
Republic Act No. 9474, or the Lending Company Regulation Act of 2007 (LCRA), requires persons or entities operating as lending companies to register as corporations and to secure from the SEC the necessary authority to operate.
 
"[T]he Commission finds that the continued operation of the online lending operators constitutes a clear violation of, and should be penalized pursuant to the [LCRA] because the evidence presented by the [Enforcement and Investor Protection Department] shows that they are engaged in, or are carrying out a lending business without the required license from the Commission, not to mention the fact that they are not registered corporations," the SEC said.