THE SECURITIES and Exchange Commission (SEC) on Monday warned illegal lending companies of the new penalties under Republic Act No. 11765 or the Financial Products and Services Consumer Protection Act (FCPA), as it took down another illegal lending operation.
In a media release, the regulator said entities engaged in abusive debt collection practices may now be criminally prosecuted for violating Section 8(d) of FCPA.
Under the FCPA rules and regulations, financial service providers as well as their collections agents and representatives are prohibited from using abusive collection or debt recovery practices against their consumers.
Additionally, violators of the law will be penalized with a maximum fine of P2 million or up to five years of imprisonment, or both.
“Financial services providers, including entities engaged in lending and financing, are required to respect the privacy and protect the data of their financial consumers,” the SEC said.
“Such entities are required to inform financial consumers if their data will be shared to third parties,” it added. The warning comes after a joint operation of the SEC Enforcement and Investor Protection Department and the Philippine National Police Anti-Cybercrime Group last week that resulted in the arrest of eight individuals identified as operators, managers, employees, and agents of Realm Shifters BPO Services/FESL BPO Services in Pasig City.
In earlier releases, the SEC has taken down Phil86 Gurunanak Lending and Trading Corp. (Phil86), Dr Verma Lending Corp., and 7 Lions Lending Management Corp., among others, in its efforts to combat illegal lending. — Adrian H. Halili